E100: Reflecting on the first 100 shows, fan questions, nuclear threat, markets, Amazon & more

00:00:00.000 | J. Cal, do you have intros today?

00:00:01.800 | No, I don't have time for intros.

00:00:03.160 | Oh, come on.

00:00:04.440 | All right, fine.

00:00:05.280 | He started as a nerd with no followers on Twitter.

00:00:07.640 | Now he's a nerd that gets recognized

00:00:09.480 | when leaving the shitter.

00:00:10.520 | He turned water into wine.

00:00:11.840 | He just wants to please us.

00:00:13.260 | Now he's a mixture of Kermit the Frog

00:00:15.300 | and a science nerd Jesus.

00:00:16.880 | He's the man with the stans,

00:00:18.160 | the queen of quinoa, the sultan of science,

00:00:20.040 | the prince of Prozac, the lord of Lexapro.

00:00:22.680 | He gets stops for selfies all over town.

00:00:25.400 | My producer fee gave him a mental breakdown.

00:00:28.120 | The sultan of Zoloft, Mr. David Brebarg.

00:00:30.680 | It's true, it did give me a breakdown.

00:00:32.680 | It's true. It did,

00:00:33.520 | but you're over it now.

00:00:34.340 | You just name dropped three SSRIs in that intro.

00:00:36.600 | It was incredible.

00:00:37.480 | Well, I talked to his psychiatrist.

00:00:39.880 | He said he's working on the cocktail.

00:00:41.240 | Yeah, save some for me.

00:00:42.640 | (laughing)

00:00:44.680 | Oh, you?

00:00:45.520 | Speaking of you, he's got a very quick wit

00:00:47.920 | and impeccable grammar,

00:00:49.320 | known for building beautiful products that don't work.

00:00:51.600 | Oh my God.

00:00:52.440 | Like Colin in Yammer.

00:00:53.800 | He used to invest in SaaS quite a lot.

00:00:56.040 | Now he's fighting a brigade of Ukraine bots.

00:00:58.800 | He's spending so much time in his bunker,

00:01:00.920 | it's starting to get smelly.

00:01:02.320 | We see him only three times a week,

00:01:03.920 | all in Tucker and Megyn Kelly.

00:01:06.200 | He'd invest in your startup if you had the knack,

00:01:08.600 | but right now he needs that cash for his GOP super pack.

00:01:12.200 | The world's biggest sass-o,

00:01:13.560 | the rain man himself, Mr. David Sacks.

00:01:15.480 | Sass-le.

00:01:16.320 | That's a repeat joke.

00:01:19.480 | That's not.

00:01:20.300 | I know, but it kills every time,

00:01:21.760 | so I'm gonna keep repeating it until you stop laughing.

00:01:24.800 | His wardrobe costs so much, he can't get into a scuffle.

00:01:27.840 | He bought all his friends with his white truffles.

00:01:30.240 | He scaled Facebook to a billy.

00:01:32.120 | That wine collection, it's just fucking silly.

00:01:34.520 | He's on the world tour meeting with princes and kings.

00:01:37.120 | Is he talking luxury sweaters or maybe bigger things?

00:01:40.500 | The dictator himself, Chamath Palihapitiya.

00:01:43.560 | - Wow, that was really nice, actually.

00:01:45.240 | - Wow, I mean, I appreciate that.

00:01:47.120 | - You were obviously trying to get invited

00:01:48.280 | to dinner tonight.

00:01:49.560 | - I'm trying to get off the alternate slide.

00:01:50.880 | - Alternate list.

00:01:51.720 | He's trying to get off the alternate.

00:01:52.840 | The email was harsh.

00:01:54.080 | Nine was alternate.

00:01:56.080 | You were trolling me.

00:01:57.040 | I know I have a seat.

00:01:58.520 | As for me, I'm the world's greatest moderator

00:02:00.520 | who can't take a note.

00:02:01.600 | Compared to these guys, I'm just a millionaire who's broke.

00:02:04.100 | The All In Summit almost killed us,

00:02:06.080 | but we came back from death's door.

00:02:07.900 | I knew we peaked when Freeberg took over the dance floor.

00:02:11.080 | We love the fans, but we love each other more.

00:02:13.680 | Thanks for the first 100, fellas.

00:02:15.360 | Here's to 100 more.

00:02:16.560 | - Really good.

00:02:17.440 | - Wow.

00:02:18.520 | - That's really, really good.

00:02:19.600 | Look at you touching a note.

00:02:20.720 | - Surprisingly, you became prepared today.

00:02:23.280 | (laughing)

00:02:24.200 | - First time.

00:02:25.600 | After 100 episodes, he finally figured out

00:02:27.560 | he has to prepare.

00:02:29.120 | So good.

00:02:29.960 | - That was the note.

00:02:30.780 | Just prepare.

00:02:31.620 | - Just do your job.

00:02:33.120 | - Do your job.

00:02:33.960 | - Do your job.

00:02:35.000 | - Do your job.

00:02:35.840 | - Do your unremunerated job.

00:02:38.000 | - Do your job.

00:02:38.840 | - Speaking of unremunerated,

00:02:40.120 | we heard that somebody's grifting off the pod.

00:02:43.160 | - Oh yeah, so good point.

00:02:44.860 | What we heard, Sax,

00:02:46.720 | is that you got a big care package from Montclair.

00:02:50.020 | - Yeah, that's true.

00:02:51.240 | - What?

00:02:52.320 | - What I think we're all gonna declare today

00:02:53.840 | is that we all wanna wet our beak.

00:02:55.960 | And if Montclair sends each of us a care package,

00:02:58.560 | we will all wear Montclair gear at episode 101.

00:03:01.920 | - Montclair's my brand.

00:03:02.920 | Go go your own brand.

00:03:04.280 | - Yeah, we decided to.

00:03:05.960 | - Jamal's got Laura Piano.

00:03:07.520 | I got Montclair.

00:03:08.520 | You go get like, you know, Izod or something.

00:03:11.280 | I don't know.

00:03:12.120 | - Izod, Izod, Izod.

00:03:13.560 | - Actually, I got Izod too.

00:03:15.320 | You have to do, get off Lauren.

00:03:17.400 | - I got Uniclou.

00:03:18.240 | - We got Gap Kids for J-Cal.

00:03:20.240 | (laughing)

00:03:21.080 | - Sax, you didn't declare your Montclair gift package,

00:03:23.840 | by the way.

00:03:24.680 | That was the discovery we made this weekend.

00:03:26.600 | - So I wanna thank the folks at,

00:03:29.000 | there's a company called (beep)

00:03:31.000 | and they sent me this gift,

00:03:34.760 | actually this hoodie, this Montclair hoodie,

00:03:36.480 | which I'd never seen before.

00:03:37.320 | - Wait, what is this plug you?

00:03:39.080 | They send you a hoodie for $1,200

00:03:41.280 | and they get a 50,000 ad slot?

00:03:43.360 | - There were several other things.

00:03:44.480 | I'll bring you guys each a shirt from Montclair.

00:03:46.960 | - Oh, we get the shirt?

00:03:47.800 | - A shirt?

00:03:48.640 | - Yeah.

00:03:49.460 | - You got the three for five.

00:03:50.300 | - These guys are getting hundreds of thousands

00:03:52.480 | of dollars of revenue.

00:03:53.320 | - Wow, Sax is the grifter now.

00:03:54.160 | - We get a shirt.

00:03:55.200 | Yeah.

00:03:56.040 | - How bad is your portfolio that you're grifting?

00:03:57.880 | Did you put this Montclair stuff

00:03:59.640 | onto like eBay after you got it?

00:04:01.880 | - I was already wearing it and they sent me more.

00:04:03.760 | So I'm gonna wear, this hoodie is pretty cool.

00:04:06.040 | What can I say?

00:04:06.880 | I'm not gonna, what else is cute?

00:04:07.720 | - Our stock is 3 cents

00:04:08.560 | and all of a sudden you're grifting.

00:04:09.960 | - I, just for everyone listening,

00:04:11.720 | I'm looking for a wardrobe upgrade.

00:04:12.920 | - Too soon?

00:04:13.880 | - Okay, just send my package to my office or something.

00:04:16.000 | - Let me tell you something,

00:04:16.840 | there's no upgrade that's gonna help.

00:04:17.840 | Freeberg, I think you're fucked.

00:04:19.600 | - No, I'm gonna bring you guys Montclair shirts

00:04:21.260 | to the poker game tonight.

00:04:22.180 | - Gee, thanks Sax.

00:04:23.300 | Appreciate that.

00:04:24.140 | - How did you guys even find out that he got this gift?

00:04:27.580 | - We're at his Fleet Week party

00:04:29.300 | and there was a Blue Angels party

00:04:31.820 | and there was someone there who started telling me,

00:04:35.060 | like, did you hear that Sax got this whole thing?

00:04:37.380 | - Oh, somebody, there's a rat?

00:04:39.220 | - There was a rat.

00:04:40.040 | I'm not telling you who it was,

00:04:40.880 | but someone told me. - He's got a leaf.

00:04:41.720 | He's got a mole.

00:04:42.820 | - We were talking about the podcast.

00:04:44.140 | We were talking about Sax's hat.

00:04:45.740 | - 100%, it was Wu Wei.

00:04:47.180 | 100%.

00:04:48.100 | - No, no, it wasn't Wu Wei.

00:04:49.260 | - No. - 100%.

00:04:50.100 | - Was it Jeff?

00:04:51.140 | - No, one of my friends was in the man cave

00:04:54.620 | and he saw this, like, care package from Montclair

00:04:56.900 | and he really admired this, like, jacket.

00:04:59.220 | It was like a puffer jacket,

00:05:00.500 | but with, like, wool sleeves or something.

00:05:02.860 | - Oh, so you gave it to him?

00:05:04.100 | - And I gave it to him.

00:05:04.940 | He liked it so much, I'm like,

00:05:06.780 | here, you take it. - You gave what?

00:05:07.600 | - You're not even on the pod.

00:05:08.820 | - He's not even on the pod.

00:05:09.980 | Give it to producer Nick.

00:05:11.300 | - So he was walking around with it

00:05:12.780 | and he was really appreciative.

00:05:14.420 | So maybe he said something or what?

00:05:16.220 | - No. - I can't believe this.

00:05:17.540 | The grift is crazy.

00:05:18.860 | - Let's just say there was a lot of conversations

00:05:20.820 | going on about your care package, Sax.

00:05:23.060 | - Well, and it makes us wonder, Sax,

00:05:24.940 | are there other care packages that have come in?

00:05:27.380 | - Or Chamath?

00:05:28.220 | - Have you been promoting other stuff on here?

00:05:29.780 | So who makes the couch behind you?

00:05:30.620 | - Some political magazines that you wouldn't want to read.

00:05:32.700 | - Chamath, how much of your Loro Piano

00:05:33.940 | have you actually paid for over the past year?

00:05:36.020 | That's a great question. - 100%.

00:05:38.980 | I would never accept it for free.

00:05:41.740 | - Oh. - 100%.

00:05:42.940 | It's important, look, wait, no, all joking aside,

00:05:45.900 | it's hard if you're running a clothing business,

00:05:48.800 | especially if you're like a small niche provider of stuff.

00:05:51.200 | So, you know, you have a responsibility

00:05:53.220 | to pay for this stuff, not to grift and get it for free.

00:05:55.180 | - No, I know.

00:05:56.100 | When I was at the Loro Piano store

00:05:57.540 | on 57th Street in Manhattan, the 18,000 square foot store,

00:06:01.020 | I was thinking the same thing.

00:06:01.980 | These poor people, how do they survive?

00:06:04.620 | - Well, Loro Piano's only

00:06:05.620 | on the LG Amazon. - $270 square foot rent.

00:06:08.180 | Maybe Loro Piano. - How are they making it?

00:06:09.500 | - I would just go back. - Poor purveyors, Friedberg.

00:06:12.340 | - Exploiting poor baby goats.

00:06:14.260 | - Well, whatever, I mean, the fact is the market's down.

00:06:16.580 | There's gonna be a little grifting on the margins.

00:06:18.340 | It's understandable.

00:06:19.340 | (upbeat music)

00:06:21.920 | Friedberg, he loves to produce every 17th episode.

00:06:39.540 | He does a great job.

00:06:40.380 | - Oh no, I like to prepare,

00:06:41.700 | or at least know what the heck we're gonna talk about

00:06:43.480 | when we get together.

00:06:44.320 | - And here are some prompts.

00:06:45.380 | He got these prompts because--

00:06:46.220 | - Producer not doing his job, yeah, go ahead.

00:06:48.500 | - Producer, oh God.

00:06:50.300 | All right, so first up on Friedberg's curiousness,

00:06:53.780 | this is, Friedberg--

00:06:55.620 | - All right, if this is how you're gonna do it,

00:06:56.740 | let's skip ahead to the next section, come on.

00:06:58.700 | - No, no, no, okay.

00:06:59.620 | So-- - Go, go, go.

00:07:01.580 | - Why do you think Chamath people love the podcast?

00:07:04.580 | Why do you think they listen?

00:07:05.500 | Why do you think they love it?

00:07:07.320 | What is the phenomenon?

00:07:08.980 | What lightning has been captured in this bottle?

00:07:11.020 | - First is I think that they appreciate our friendship.

00:07:14.580 | It's kind of like odd and quirky.

00:07:16.520 | And I think a lot of, you know,

00:07:20.180 | it maps to like relationships that they have

00:07:23.140 | amongst their own friends.

00:07:24.260 | So that's what makes it relatable.

00:07:26.500 | But the second is that all of us uniquely

00:07:28.940 | have a point of view

00:07:30.260 | about stuff that matters more and more in the world.

00:07:35.100 | I think that's just the basics of it.

00:07:36.640 | Like, it's not like technology is going away

00:07:39.460 | and it's not like its impact in the world is going away.

00:07:42.140 | And the more it becomes mainstream,

00:07:43.420 | the more it's important for a lot of folks

00:07:45.540 | to understand what's happening.

00:07:47.860 | And I think we provide a pretty unfiltered view of it.

00:07:50.960 | And we do it where, and this is a lot of credit to Sax,

00:07:55.900 | more than anyone else on the show,

00:07:57.800 | has to take a counterpoint and steel man

00:08:01.260 | what would otherwise be controversial views.

00:08:03.100 | And if he didn't have his three friends around him,

00:08:05.500 | that would make the pod meaningfully worse, I think.

00:08:08.900 | - Can you explain for people who don't know

00:08:10.280 | what steel manning is, what that means?

00:08:12.180 | - Well, it just means like to have intellectual honesty

00:08:15.140 | around a point of view and actually put your best foot

00:08:17.940 | forward in trying to explain it,

00:08:19.060 | even when it's not orthodox,

00:08:20.540 | even when it's not what the mainstream would say is right.

00:08:23.540 | And so what it actually does is it creates a contrast

00:08:27.640 | against every other alternative

00:08:29.400 | that you have to learn about things,

00:08:31.020 | which you find incrementally is biased.

00:08:35.280 | And I think that's what we've gotten right.

00:08:37.780 | We are four friends that have a reasonable point of view

00:08:40.820 | rooted in some amount of success.

00:08:42.780 | And I think that that's important

00:08:43.860 | because it gives us credibility

00:08:45.740 | and we take all sides of issues.

00:08:48.420 | - Yeah.

00:08:49.260 | - And oftentimes it is not the obvious,

00:08:52.740 | simple, reductive answer.

00:08:55.220 | And I think that that's where it really shines.

00:08:58.420 | - Just so people know about the steel man argument,

00:08:59.940 | just wanna make sure people are crowded.

00:09:01.500 | I think most people refer to it as the act of presenting

00:09:04.900 | the other argument in the strongest way possible

00:09:07.140 | to be intellectually honest, like the opposite of strong man.

00:09:09.860 | - Exactly, opposite of strong man.

00:09:11.620 | 'Cause the way the debate happens on Twitter and so forth

00:09:15.220 | is it's almost like the intellectual debate

00:09:18.020 | is being attacked using opposition research tactics

00:09:22.620 | like it were a political campaign.

00:09:23.940 | So in other words, they go back through anything

00:09:25.940 | you might've said or written,

00:09:27.660 | take the thing that was most wrong or least justifiable

00:09:31.660 | or the thing they can even just take out of context.

00:09:34.300 | And then they'll try to make it about that

00:09:36.400 | as opposed to the argument you're actually making.

00:09:39.340 | And we just see this tactic over and over again.

00:09:41.980 | And it's not an intellectually rigorous way

00:09:45.540 | of having a debate about something.

00:09:47.420 | - You don't learn anything.

00:09:48.980 | And deep down inside, you know that it's contrived.

00:09:51.860 | And that is the, in a nutshell,

00:09:53.780 | so it almost in many ways has less to do

00:09:56.500 | with how good we are,

00:09:58.380 | but frankly how bad all the alternatives are.

00:10:01.460 | So even if you wanted to learn about tech

00:10:03.620 | and you go up and you sign up for these newsletters,

00:10:07.420 | or if you look at some of these tech sites,

00:10:09.420 | they're really terrible.

00:10:11.660 | And they have done an increasingly terrible job

00:10:14.980 | over the last five years in telling the most important

00:10:18.660 | things, the truth and everything in between.

00:10:21.780 | And so if you can find a source for an hour a week

00:10:26.420 | that is trying to tell you how basically the world

00:10:30.420 | is going to come together in a really integrated,

00:10:33.820 | multifaceted way, it's not like we're right.

00:10:37.640 | And it's not like we know better than other people.

00:10:39.480 | In fact, many times a lot of the criticism I get is,

00:10:42.200 | how dare you talk about X or how dare you talk about Y?

00:10:45.600 | Because it makes people who are experts in that field,

00:10:48.560 | you know, feel like, how dare you come into my realm

00:10:50.560 | and even have an opinion on, you know,

00:10:53.200 | what Russian politics was like in the 1980s.

00:10:56.320 | And those things really annoy these folks

00:10:58.220 | because they feel that those opinions and that knowledge

00:11:01.520 | should be cordoned off and held tightly as this secret

00:11:04.800 | that only they are allowed to talk about into the world.

00:11:07.440 | And this is the point where with the internet,

00:11:10.440 | all this knowledge is accessible.

00:11:12.520 | So the value of that knowledge, in my opinion,

00:11:15.520 | is the least it's ever been.

00:11:16.720 | It's the interpretation that's valuable.

00:11:19.240 | And it's the ability to actually like think narratively

00:11:21.640 | around how all these things connect.

00:11:23.440 | And this is where I give a lot of credit.

00:11:24.880 | I think you guys do an incredible job.

00:11:26.360 | I think the way Friedbrook thinks is super unique.

00:11:28.920 | I think the way that Saksis thinks is unique.

00:11:31.220 | I think J. Cal, your courage to basically fight back

00:11:34.800 | is very special.

00:11:35.760 | All of it together is a really unique recipe at works.

00:11:39.260 | And what I will tell you consistently

00:11:41.440 | is the number of people that listen to this

00:11:46.440 | of import and influence, I am constantly shocked.

00:11:50.160 | And if you are not sure of it,

00:11:52.520 | you need to get out of this stupid little echo chamber

00:11:54.560 | of Silicon Valley, go to New York, go around the world.

00:11:57.880 | And if you're in the right meetings,

00:11:59.080 | it's incredible how folks are getting educated.

00:12:01.120 | Using this pod.

00:12:01.960 | And I think that's really amazing.

00:12:03.520 | - Yeah, I think there's like been a tendency

00:12:07.880 | in like what we call media today,

00:12:10.760 | historically kind of communication amongst humans.

00:12:14.840 | It was very slow for a communication cycle

00:12:18.280 | to go from beginning to end to close

00:12:19.920 | because we had print and books and then telegraphs

00:12:22.960 | and then telephones and then television and radio.

00:12:26.280 | And the internet I think has really changed the cycle,

00:12:29.400 | the loop cycle to the point that a story iterates

00:12:33.920 | and proliferates very quickly.

00:12:36.440 | And a lot of people talk about the news cycle

00:12:38.360 | being very short nowadays.

00:12:39.800 | And what that means is that there is a group think approach

00:12:44.800 | to resolving to a point of view on what the news is.

00:12:48.440 | So the news comes out, everyone iterates on it,

00:12:51.120 | they form their point of view,

00:12:52.240 | and all of a sudden everyone's on the same point of view.

00:12:54.480 | And so there is no room for dissent or debate or discussion

00:12:58.060 | because the cycle closes so quickly

00:12:59.760 | and everyone coalesces around the same point of view.

00:13:02.880 | And nowadays I think we see not just that unipolar behavior,

00:13:06.720 | but we see this bipolar behavior

00:13:08.880 | where everyone coalesces on their point of view

00:13:11.640 | and how their point of view is the opposite

00:13:14.480 | of the other side.

00:13:16.000 | And everyone has their own heuristic

00:13:17.640 | for what the other side is.

00:13:19.160 | There's this populism versus elitism siding,

00:13:21.920 | there's this red versus blue siding,

00:13:24.680 | there's this us versus them siding,

00:13:26.840 | us versus China siding, everything is now bipolar.

00:13:30.840 | And so you very quickly coalesce around what your poll says

00:13:33.960 | and what your poll is instructing you to believe.

00:13:37.340 | And that is what is fundamentally wrong

00:13:39.600 | with how the system is working today.

00:13:41.800 | And I think what people find refreshing

00:13:43.960 | about a discourse that doesn't succumb

00:13:47.200 | to that bipolarity as a standard

00:13:50.280 | is that it provides people the ability

00:13:53.200 | to have a real rational, out of sync point of view

00:13:56.240 | that maybe changes one's point of view

00:13:57.800 | and changes one's mind in a meaningful way.

00:14:00.200 | And I think that's what's really missing today.

00:14:01.840 | And I think maybe sometimes we do a good job

00:14:04.360 | and we touch on that.

00:14:05.920 | And so that's what I would strive to do

00:14:07.320 | is to always try and avoid that bipolarity on everything.

00:14:10.200 | Zen Buddhists call it dualistic thinking.

00:14:15.400 | The human brain and generally the universe

00:14:18.200 | seems to evolve into this kind of dualism on everything.

00:14:21.600 | And it's not really always the case

00:14:23.160 | that there are shades of gray, that there is nuance,

00:14:26.920 | that there is a complex dimensionality to things

00:14:29.920 | that I think people really,

00:14:31.160 | if they take the time to understand,

00:14:32.680 | recognize that maybe it's not left and right,

00:14:34.360 | maybe it's not elite and populism,

00:14:36.080 | maybe it's not all black and white.

00:14:37.680 | And that's an important, hopefully framing

00:14:40.680 | that maybe we can bring to light

00:14:43.080 | through our diagnosis of what's going on

00:14:45.200 | in things right now.

00:14:46.280 | - Yeah, I'd like to add to that.

00:14:47.840 | I think there's a ton of great journalism going out there.

00:14:50.080 | We see it.

00:14:51.000 | There's a ton of great sub-sacks out there.

00:14:52.400 | People go deep.

00:14:53.240 | There's other great podcasts out there.

00:14:54.760 | And right now it's a tumultuous time for media journalism

00:14:58.760 | and getting information.

00:15:00.000 | And what sources do we actually trust?

00:15:02.800 | Who actually is thinking in a crisp way

00:15:06.040 | and informing people?

00:15:07.760 | And having been a former journalist,

00:15:10.400 | when we were journalists,

00:15:11.360 | we knew that we would get 10, 20, 30, 40% of a story.

00:15:14.480 | We would publish it and we would try our best.

00:15:17.520 | But journalism has changed dramatically

00:15:20.440 | in the last 20 years.

00:15:21.600 | And I can tell you-

00:15:23.200 | - Journalism is dead.

00:15:24.520 | Sorry.

00:15:25.360 | - Okay.

00:15:26.200 | - I'm sorry.

00:15:27.020 | - There's still some great journalism occurring.

00:15:27.860 | It's on the margins.

00:15:28.880 | - It's irrelevant.

00:15:29.960 | And I'll tell you why.

00:15:30.840 | Because the facts are known instantaneously

00:15:33.360 | on Twitter and through the internet.

00:15:34.680 | We don't need people to relate facts.

00:15:36.420 | We need people to wrap facts in context

00:15:39.000 | and allow us to come to our own conclusions.

00:15:41.280 | That's why I think journalism isn't what it used to be.

00:15:43.480 | That's why people who are historically journalists

00:15:46.880 | struggle because now they actually have to create context

00:15:49.920 | and narrative and have an opinion.

00:15:51.480 | But when you publish that into the Wall Street Journal

00:15:53.520 | or the New York Times, it becomes very confusing.

00:15:56.280 | They don't know that that's what they were supposed to do.

00:15:58.400 | That's not what they used to do.

00:15:59.800 | That's not how Pulitzer Prizes were historically given out.

00:16:03.760 | And that's why everybody then, you know,

00:16:05.060 | rants and rails about things.

00:16:05.900 | - Well, that's where I was kind of going is, you know,

00:16:07.520 | if you look at it as journalists, people don't know this,

00:16:11.280 | but journalists are being compensated.

00:16:13.040 | Their little salaries in many cases

00:16:14.880 | are based on their follower counts.

00:16:16.240 | They're based on what audience

00:16:17.800 | they're bringing to the table.

00:16:19.160 | And you see this in Substack.

00:16:20.320 | Substack just said, we're going to hire the top journalists

00:16:23.720 | who have the most followers on Twitter.

00:16:25.360 | - But you have to change the word

00:16:26.480 | so that you change how people think about it.

00:16:28.040 | These people are not journalists.

00:16:29.520 | These people are opinion makers.

00:16:31.160 | - Okay, in some cases they're doing journalism.

00:16:33.080 | In some cases they're staying-

00:16:33.920 | - No, they're not. - No, no.

00:16:34.920 | There are some cases where they're actually doing

00:16:36.480 | real journalism, Chamath.

00:16:37.360 | There are people doing investigative reporting still.

00:16:39.480 | It's not the majority of what you see, but it still exists.

00:16:42.280 | It's just a very much smaller percentage.

00:16:44.500 | But putting that aside, if you think about-

00:16:46.680 | - But you can't wrap a virtuous blanket

00:16:49.160 | around a thousand people because of the acts of one.

00:16:52.560 | - I'm not, and I'm not.

00:16:53.840 | I said there's a range here.

00:16:55.560 | It's a small percentage,

00:16:56.560 | but there's still random acts of great journalism.

00:16:58.800 | - What do you think that percentage is?

00:16:59.920 | - Of content creation, I put it at 5%.

00:17:01.920 | So, you know, one out of 20. - That's a huge number.

00:17:03.600 | I'm shocked.

00:17:04.440 | - Yeah, anyway. - I think it's less than 1%.

00:17:06.360 | - But let me just finish this one thought here.

00:17:08.560 | If you are going to be hired and compensated,

00:17:13.520 | and we talk about systems here a lot.

00:17:15.120 | So just thinking from first principles,

00:17:16.400 | if you're a journalist,

00:17:17.520 | if you're a writer, opinion writer, whatever,

00:17:18.960 | you produce content for Wall Street Journal,

00:17:21.000 | for podcasts, et cetera.

00:17:22.840 | Today, let this sink in,

00:17:25.440 | your follower count is what your book advance is.

00:17:28.480 | It's what your compensation is.

00:17:30.720 | It's who hires you.

00:17:32.040 | Now, if that's the truth, and it's not all the time,

00:17:34.680 | but I think the majority of the time.

00:17:35.520 | - Which is a proof point

00:17:36.360 | that your job is not to relay facts.

00:17:38.360 | We can get facts from a thousand sources.

00:17:39.200 | - Exactly, that's right.

00:17:40.160 | Let me finish my thought here.

00:17:41.280 | And so then what happens is,

00:17:42.440 | how is follower count on Twitter actually derived?

00:17:45.600 | How do you get that follower count?

00:17:47.240 | By being tribal.

00:17:48.320 | And so what's happened is,

00:17:49.720 | journalists have became tribal,

00:17:51.120 | they get big followings, they give spicy takes,

00:17:53.360 | they pick a side, and then their compensation follows it.

00:17:56.160 | And that's why New York Times said,

00:17:57.600 | "Can we all stop on Twitter?"

00:17:58.920 | And they literally put an edict out.

00:18:00.440 | Then you look at this podcast,

00:18:02.360 | I think people look at us as,

00:18:04.560 | in their mixture, podcasting long form,

00:18:07.120 | taking the time week after week

00:18:08.640 | to spend 90 minutes chopping these things up.

00:18:11.720 | I think that's what, to the original question,

00:18:13.240 | Freiburg, you had, is what people find so great.

00:18:16.200 | When people ask me,

00:18:17.400 | I say it's really about the fact that,

00:18:19.040 | there's a friendships here and it's funny,

00:18:21.320 | but it's also informative and it's insightful.

00:18:23.440 | And at times, as you pointed out Chamath,

00:18:26.000 | you know, random acts of bravery

00:18:27.720 | and taking positions that are not popular.

00:18:30.080 | - And to think that you and Freiburg

00:18:32.400 | almost blew this up over a few hundred K.

00:18:34.440 | - I didn't.

00:18:36.160 | (laughing)

00:18:37.000 | - No, the two of you equally should share.

00:18:38.320 | - I wouldn't classify it that way.

00:18:40.080 | By the way, I think the point-

00:18:40.920 | - Yeah, here we go.

00:18:41.840 | Now the bad feelings are ready, getting spicy.

00:18:43.960 | - Just a, can I, can I-

00:18:45.800 | - I'm more of an ethical framework,

00:18:47.440 | but yeah, that's fine, go ahead.

00:18:48.440 | - Ooh, even worse.

00:18:50.480 | (laughing)

00:18:52.240 | - Look at Chamath stirring the pot.

00:18:53.800 | - Just to chime in on this point,

00:18:54.960 | I mean, I think I'm in violent agreement with you guys,

00:18:57.000 | but I'd frame it a little differently.

00:18:58.400 | I think the reason why people seek out our podcasts

00:19:01.920 | and other podcasts and sub stacks is,

00:19:05.640 | and sort of this kind of independent journalism

00:19:07.680 | and are willing to pay for it,

00:19:09.240 | is because the mainstream media

00:19:11.040 | has become totally devoid of substance.

00:19:15.200 | It's as partisan and ideologized as it's ever been.

00:19:20.200 | Reporters are extremely ideological.

00:19:22.040 | You look at the New York Times, the Washington Post,

00:19:24.640 | the major television networks,

00:19:26.760 | it's all kind of the same thing.

00:19:28.280 | And yeah, there is like,

00:19:29.920 | a little bit of an echo chamber problem

00:19:31.520 | in terms of the partisan politics,

00:19:32.920 | but the mainstream media is the most ideologized

00:19:35.880 | it's ever been.

00:19:37.360 | I mean, just to give you one small example

00:19:38.960 | that we talked about in the pod,

00:19:40.560 | we had two quarters of negative GDP growth,

00:19:44.400 | which the media has always considered

00:19:45.720 | to be the definition of recession.

00:19:47.160 | And then all of a sudden they said,

00:19:48.240 | no, we can't know what a recession is anymore

00:19:50.360 | because they know that'd be a horrible headline for Biden

00:19:52.440 | right before the midterm elections.

00:19:53.840 | That's more of a partisan version.

00:19:55.360 | I think on the, a more ideological version

00:19:58.600 | would be just around this Ukraine war.

00:20:00.600 | I mean, it's just incredible how biased the coverage is.

00:20:04.200 | They don't even present the other side of the story,

00:20:07.920 | like let's call it the Mearsheimer take

00:20:09.800 | about how we got to this point that we're in.

00:20:12.760 | So the American people just aren't being informed at all.

00:20:15.240 | You know, we love to talk about how the people

00:20:18.680 | of all these other countries are being propagandized

00:20:20.760 | by their governments.

00:20:21.600 | We never talk about how propagandized

00:20:23.680 | the American people are.

00:20:24.680 | The media does not present the other side of the story

00:20:27.040 | at all on how we got into the Ukraine war

00:20:31.440 | and how we're now at the brink

00:20:32.600 | of what Biden calls Armageddon.

00:20:34.600 | - Yeah. - So how are we gonna get out of it?

00:20:36.120 | How are we gonna get out of it?

00:20:37.680 | - Any topic, by the way.

00:20:39.240 | - I just said that was my punch.

00:20:40.680 | - There's so many topics that we see,

00:20:43.360 | you know, effectively short form

00:20:46.240 | and short form meaning it can be presented

00:20:48.440 | in a soundbite or on a TikTok clip

00:20:50.800 | or in a couple of paragraphs

00:20:52.920 | where someone's attention span,

00:20:54.160 | before someone's attention span lapses out,

00:20:56.920 | always misses the dimensionality that got us to that point.

00:21:00.480 | And so there's one perspective,

00:21:01.960 | one point of view on one dimension

00:21:04.960 | and the dimension like Sax is talking about

00:21:06.840 | about the time and the history of the dynamics

00:21:09.840 | of all the countries and all the people

00:21:12.040 | and all the interactions that have happened

00:21:13.760 | for the past couple of decades that led up to this moment.

00:21:17.040 | But then this moment is taken in its context alone

00:21:20.280 | and reclassified as being something

00:21:22.760 | that is good versus evil.

00:21:24.880 | It completely misses the entire storyline of what happened.

00:21:28.080 | It's like going to the end of a fairy tale

00:21:30.560 | and saying, here's this moment of what happened

00:21:32.600 | and all the buildup and all the things that occurred

00:21:34.840 | are often missing and all the different sides

00:21:36.480 | of the story are missing.

00:21:37.960 | And I think that that's really what makes it

00:21:39.800 | so difficult today to feel like you can trust authority

00:21:43.720 | and that you can trust the media that's presented to you

00:21:47.120 | as a consumer, not just in the US or in the West,

00:21:49.520 | but around the world,

00:21:51.000 | because there's so much that's left out

00:21:52.720 | and manipulated and kept away.

00:21:54.480 | And what people are waking up to is the fact,

00:21:56.920 | as Chamath points out, that so much of that information,

00:21:59.920 | the direct information is available now.

00:22:03.320 | And so this investigation, this ability to uncover the data

00:22:07.440 | and the storylines and the perspectives

00:22:10.080 | that are typically missing from one form of media

00:22:12.720 | is making people realize that there's so much

00:22:14.680 | that's being left out.

00:22:16.360 | The lie of a mission.

00:22:17.200 | - 100%, 100%.

00:22:18.480 | And I think in this podcast--

00:22:19.320 | - And that's what's really shocking to people nowadays.

00:22:21.960 | And I think that's what makes maybe to some degree,

00:22:23.800 | hold on, our conversation is a little more appealing.

00:22:26.800 | - I'll drop to you in a second there, Sax.

00:22:28.600 | But I did see this happen in three specific topics

00:22:31.120 | that we discussed here.

00:22:32.400 | If you remember, we talked about abortion

00:22:34.560 | and we were on that topic very early

00:22:36.280 | and no one wanted to talk.

00:22:37.760 | I remember when we started talking about

00:22:39.040 | the number of weeks, maybe how Europe looks at this,

00:22:41.560 | that wasn't part of the popular conversation.

00:22:43.360 | It was always just, are you against choice?

00:22:45.600 | Are you for killing babies?

00:22:47.280 | It was like a very two dimensional look at it.

00:22:50.200 | Immigration, same thing.

00:22:51.640 | Nobody would talk about the numbers.

00:22:52.860 | Nobody talked about recruitment.

00:22:53.960 | Nobody talked about the point systems

00:22:55.360 | used in other countries.

00:22:56.760 | It was almost like those basic things

00:22:58.520 | were not allowed to be discussed.

00:23:01.440 | Why can't the media discuss those nuances?

00:23:03.680 | And freedom of speech is, I think, the biggest one.

00:23:06.160 | And the search for truth.

00:23:08.280 | Nobody wants to talk about the fact that the ACLU

00:23:11.360 | used to actually protect unpopular speech.

00:23:14.000 | And unpopular speech is the hardest thing

00:23:16.320 | in the world to protect.

00:23:17.440 | But how did that become something

00:23:19.160 | we can't even talk about now?

00:23:21.400 | And just the snap silencing of any opinion,

00:23:24.900 | whether it's Chappelle or,

00:23:26.480 | pick a topic in freedom of speech, Trump, et cetera.

00:23:30.920 | Who gets protection for freedom of speech?

00:23:33.240 | And we'll talk about it later on the news

00:23:34.280 | but Alex Jones, obviously, a very controversial topic

00:23:37.120 | as well.

00:23:37.960 | Go ahead, Sax, you wanted to add something to it?

00:23:38.780 | - Well, I think just to take this Ukraine situation

00:23:41.200 | as an example, I think the media's biggest power

00:23:44.400 | is the power to define when time begins on an issue.

00:23:48.280 | So especially if-- - What does that mean?

00:23:49.480 | - Well, like with Ukraine,

00:23:51.120 | we're part of an escalatory spiral that's been going on

00:23:54.560 | for well more than eight or nine months.

00:23:57.720 | This issue's been going on since 2008.

00:23:59.400 | - A decade.

00:24:00.240 | Yeah, more than a decade. - Over a decade.

00:24:01.480 | So in other words, if you come in in like the seventh inning,

00:24:05.920 | okay, so to Freeworks' point,

00:24:07.120 | you come in at the end of the story

00:24:08.600 | and it's been an escalatory spiral,

00:24:10.880 | but the media just pretends like time begins on February 24th,

00:24:14.760 | of course, you're gonna have a certain kind of view

00:24:16.200 | on the subject.

00:24:17.040 | Whereas if you know the history of the situation,

00:24:20.840 | if you know that back in the 1990s,

00:24:22.840 | you had people like George Kennan,

00:24:24.320 | who was the architect of our Cold War containment policy,

00:24:26.840 | you had William J. Perry,

00:24:28.480 | who was Bill Clinton's defense secretary,

00:24:30.440 | you had Henry Kissinger, you had John Mearsheimer,

00:24:32.520 | all warned that bringing NATO right up

00:24:34.920 | to Russia's front porch was extremely provocative to them,

00:24:38.280 | that they would see that as a provocation

00:24:40.560 | that would eventually lead to a moment of crisis.

00:24:43.440 | When that moment of crisis finally came,

00:24:45.880 | we're not told that this was predicted.

00:24:49.440 | We're told that anyone who says that this war

00:24:52.240 | has anything to do with NATO expansion

00:24:54.240 | is basically a Putin apologist

00:24:56.000 | and is spouting Putin talking points.

00:24:57.560 | - All right, let's save some of that for the Ukraine talk.

00:25:00.160 | We're gonna talk about it in the news section.

00:25:01.600 | No, but I get your point.

00:25:02.440 | - You could agree or disagree with that take,

00:25:04.440 | but the point is the media doesn't even portray it.

00:25:07.480 | - They really just pick a side.

00:25:08.760 | And I think I like your analogy of like,

00:25:10.680 | just coming in for the last 15 minutes of the game

00:25:12.960 | and just describing that.

00:25:14.440 | You need to have a deeper discussion

00:25:15.920 | of how did we get here?

00:25:16.960 | How did we get here on immigration?

00:25:18.480 | Why don't we have a point system?

00:25:19.920 | Why do we look at people suddenly coming

00:25:22.160 | from south of the border differently

00:25:23.520 | than we did just 20 years ago?

00:25:25.320 | How did that become a politicized issue?

00:25:26.720 | What's the right solution here?

00:25:28.240 | Especially if we can't hire people

00:25:30.440 | for basic jobs in the United States.

00:25:32.760 | Everybody wants to know this question.

00:25:35.040 | What's your favorite,

00:25:35.880 | you have a favorite moment or a least favorite moment,

00:25:39.440 | a great moment in the show history.

00:25:41.360 | And then I guess we'll move on maybe

00:25:42.860 | to some audience questions here.

00:25:44.000 | But let's get this one 'cause an embarrassing moment,

00:25:47.360 | your favorite moment, your least favorite moment,

00:25:50.240 | a moment now you look back on

00:25:51.640 | and you're particularly proud of.

00:25:53.520 | - I love the cold opens.

00:25:54.440 | I think that they are unbelievably human

00:25:57.680 | and funny and normalizing.

00:26:00.720 | They are by far the best part of the pod in my opinion.

00:26:06.880 | And yeah, that's my absolute favorite part

00:26:11.480 | by like miles and miles.

00:26:13.420 | - Sax, you got a favorite moment other than Ukraine.

00:26:18.600 | Other than Ukraine.

00:26:19.440 | I know you got Ukraine on the brain.

00:26:21.160 | - Probably when you started talking like Joe Pesci.

00:26:24.160 | - The Joe Pesci voice.

00:26:25.720 | - I can't do it on command.

00:26:28.680 | I'm not your monkey Sax.

00:26:30.200 | Don't you talk to me like that.

00:26:31.760 | I'll get a fucking bat in here.

00:26:35.920 | No, seriously, you have any other favorite moments

00:26:40.640 | or things you're particularly proud of,

00:26:42.360 | things that people tell you,

00:26:44.080 | hey, I love this part of the show.

00:26:46.280 | - I'm also proud that we were able to air

00:26:48.720 | our dirty laundry a little bit in public

00:26:50.760 | and still get over ourselves and our own egos.

00:26:53.960 | And we're still here.

00:26:55.120 | I think that takes a lot of courage

00:26:56.520 | and a little bit of maturity

00:26:58.600 | that's not in public visibility all the time in the media.

00:27:03.600 | - I like that sentiment a lot.

00:27:05.840 | I think there's a lot of--

00:27:06.680 | - People were pretty uncomfortable about it.

00:27:07.760 | - They were uncomfortable about it.

00:27:09.560 | I think there's a lot of personal growth

00:27:10.800 | that's going on here for everybody involved.

00:27:14.320 | Freeberg, you got a favorite moment other, you know.

00:27:18.200 | - I don't like it when you and Sax fight.

00:27:20.440 | That's just annoying.

00:27:21.800 | - That's your least favorite moment when we are

00:27:23.480 | fighting while we die.

00:27:24.320 | - I literally turn my headphones off

00:27:26.360 | and I like do some emailing.

00:27:28.280 | - It really is just, it really is just this political thing,

00:27:31.560 | but yeah, it does come up.

00:27:32.640 | You know, I don't like the fact that--

00:27:33.480 | - All the moments I've been interrupted by you

00:27:35.360 | that like that just happened five seconds ago,

00:27:37.720 | like, you know, those are usually pretty tough.

00:27:40.000 | - Go ahead, Freeberg.

00:27:41.680 | - I don't know.

00:27:43.480 | What I did enjoy, I did enjoy meeting people at the summit

00:27:48.040 | who shared that this has been like a really important

00:27:52.640 | thing for them to listen to.

00:27:54.400 | I think I was at a Pete's Coffee in the city

00:27:58.360 | and some guy came up to me.

00:27:59.680 | This was early when we were doing the podcast.

00:28:03.720 | And he was like, listening to you guys

00:28:05.840 | has really helped me get through COVID.

00:28:07.640 | And he was like locked in his apartment

00:28:09.280 | and he didn't have a lot of friends

00:28:10.360 | and he didn't have a lot of people to talk with.

00:28:13.400 | And just being able to hear through, you know,

00:28:16.200 | kind of a good conversation around when's this gonna end?

00:28:19.480 | How's COVID gonna, you know,

00:28:22.120 | what's gonna change in the city?

00:28:23.440 | And hearing our friendship

00:28:25.000 | really made a big difference for him.

00:28:26.960 | And it was actually really interesting.

00:28:28.160 | That was off the show, but it made me realize

00:28:30.280 | that the show actually is impactful and helpful

00:28:32.760 | and gave me kind of the energy to keep going

00:28:35.080 | even though I've had frustrations in the past.

00:28:38.320 | So I don't know, I like those moments a lot, to be honest.

00:28:41.400 | That there's real value here for people.

00:28:44.800 | I also, I thought the summit was a lot of fun.

00:28:49.160 | I mean, I had a good time.

00:28:50.600 | - Well, you know, it's, I think we're steering towards,

00:28:54.800 | I think we're steering towards summit 2023.

00:28:56.880 | - That was me stirring the pot a little bit.

00:28:58.800 | - I think we're steering towards 2023.

00:29:01.320 | - One and done.

00:29:02.160 | - Listen, as far as I'm concerned,

00:29:04.400 | you do it, you produce it, or you hire a producer,

00:29:06.720 | I'll show up.

00:29:07.560 | I don't need to make a producer fee, you can do it.

00:29:11.600 | You can take the producer fee, whatever it is.

00:29:13.040 | - All right, guys, I got a couple of questions here

00:29:14.640 | from the audience.

00:29:15.640 | You guys see this list?

00:29:18.640 | - Yeah, we got it. - Anything stand out

00:29:19.480 | for you guys?

00:29:20.320 | - Well, you pick, you pick.

00:29:21.160 | - So here's a question, we got it over email from Nathan.

00:29:26.160 | And Nathan said, "We know the reasons,

00:29:29.120 | the reason you guys started the pod.

00:29:30.760 | What is the motivation of each bestie

00:29:32.600 | to continue doing it every week?"

00:29:34.560 | - Now I ask myself that every week.

00:29:37.840 | (laughing)

00:29:38.680 | - You and me both. - That's not to say.

00:29:39.520 | - You and me both.

00:29:40.360 | - That's sexist therapy.

00:29:42.440 | It was sexist therapy yesterday.

00:29:43.760 | Why am I doing this?

00:29:44.600 | - No, I mean, seriously, I'm thinking about taking a break.

00:29:45.720 | Not 'cause I don't like doing it, but it is time consuming.

00:29:48.440 | And I do want time to get back

00:29:50.200 | to doing some business writing.

00:29:51.560 | I was on a pretty good track to publish a book about SaaS.

00:29:56.000 | Before we started doing the pod,

00:29:57.200 | I had written a lot of business blogs.

00:29:59.040 | And this is kind of cut into that.

00:29:59.880 | - Whoa, taking a break?

00:30:01.480 | How many weeks? - I don't know,

00:30:02.320 | I'm thinking about it 'cause--

00:30:03.520 | - What, 10 weeks?

00:30:04.360 | What are you thinking?

00:30:05.200 | - Maybe like a month or something, yeah.

00:30:07.040 | - Oh, four weeks.

00:30:07.880 | Ah, you can take, that's no big deal.

00:30:08.720 | - Maybe 10 weeks maybe, I don't know.

00:30:10.280 | - Four to 10, all right, well.

00:30:11.760 | - I've got like a hopper.

00:30:12.600 | - Right now, Brad Gershner is like doing jumping jacks

00:30:15.040 | in his backyard. - Yeah.

00:30:15.880 | - He's like, "Put me in the game."

00:30:17.120 | - Well, we could do that.

00:30:18.040 | I mean, I've got like five half-written business blogs

00:30:21.040 | in my hopper that I really wanna finish.

00:30:23.040 | And so I don't know.

00:30:25.360 | - The show does take a lot of cognitive energy

00:30:27.280 | is what you're saying.

00:30:28.120 | It takes a lot of those cycles, right?

00:30:28.940 | - Does it take a lot of your time each week, Zacks?

00:30:30.880 | - I mean, as you guys know,

00:30:32.160 | the taping is only a couple hours,

00:30:33.480 | but then it's just keeping track of all the issues.

00:30:35.960 | And then, you know, if I'm preparing takes for this pod,

00:30:39.280 | I also turn some of those takes into articles.

00:30:41.720 | - This is the cost. - Like for Newsweek

00:30:43.320 | or the American Conservative or whatever.

00:30:44.960 | - And responding. - 'Cause I've been

00:30:45.800 | publishing a lot. - And responding.

00:30:46.620 | - And responding. - And responding.

00:30:47.460 | And then I have tweeting takes as I'm coming up with them.

00:30:50.520 | - Now it's three days. - This is my point,

00:30:51.360 | which is I think the load for Zacks,

00:30:54.640 | because he is the most heterodox, is the heaviest.

00:30:58.480 | And this is like poorly understood.

00:31:00.520 | It's easy to just basically be on the side

00:31:02.520 | of the current conventional wisdom,

00:31:04.280 | or to not have an opinion

00:31:05.560 | and to talk about things that are orthogonal.

00:31:07.400 | But David is consistently the one

00:31:09.140 | that wades into the middle of the ocean.

00:31:10.760 | And it is, I can understand why you find it exhausting.

00:31:13.360 | - There's an undertone there.

00:31:14.480 | - No, because he-- - He gets dragged under.

00:31:16.440 | - No, Jason, he has to be more prepared than the rest of us

00:31:19.400 | because he is more open to the attacks

00:31:21.280 | from all of these nitwits.

00:31:23.120 | (Jason laughs)

00:31:24.240 | - It's true. - He just is.

00:31:25.080 | - I mean, every day on Twitter,

00:31:27.400 | I'm being told I'm Neville Chamberlain or blah, blah, blah.

00:31:29.780 | - These are like uninformed nitwits.

00:31:31.480 | You know, the cancer of people who comment

00:31:35.560 | on Twitter is the following.

00:31:37.340 | They suffer from the worst kind of cancer,

00:31:39.480 | which is a lack of belief in themselves.

00:31:41.800 | And so what they do is they point to other people

00:31:44.680 | and try to convince yet more people to not believe in them.

00:31:47.600 | But that has nothing to do with anything.

00:31:48.960 | It's just misdirection from their core problem,

00:31:51.240 | which is they don't believe in themselves.

00:31:52.680 | And so, you know, David has to fight all of that stuff off,

00:31:55.160 | but he has to fight it off with logic,

00:31:56.620 | which must be exhausting.

00:31:58.160 | You know, my approach has just been to turn off comments

00:32:00.260 | and to not start.

00:32:01.400 | This is the single biggest problem, I think,

00:32:03.320 | with social media is it's at this heightened point

00:32:06.560 | where it's this virulent strain

00:32:08.840 | of a lack of belief in oneself

00:32:10.560 | that manifests in this hatred

00:32:12.560 | that you direct to anybody else that believes in themselves.

00:32:14.680 | - Interesting theory.

00:32:16.080 | - Yeah, and I would just add to that,

00:32:17.920 | you know, it's not like I haven't heard

00:32:21.720 | any of the arguments that they're making.

00:32:24.200 | I guarantee you they have not heard

00:32:26.080 | the arguments I'm making,

00:32:27.320 | but I've heard all the arguments they're making.

00:32:30.080 | I'm totally familiar with 1938, Munich, Neville Chamberlain,

00:32:33.080 | all this kind of stuff.

00:32:34.080 | I just don't think that is the correct understanding

00:32:36.640 | of what's happening right now.

00:32:37.520 | I think the correct historical analogy

00:32:39.400 | is either 1914 with World War I and the blank check guarantee

00:32:43.080 | or it's 1962, the Cuban Missile Crisis.

00:32:46.120 | The people on the other side

00:32:48.040 | generally don't understand that.

00:32:50.000 | They are just kind of part of this like Twitter mob

00:32:52.800 | who's buying into the current thing

00:32:54.200 | and whatever they're told by the media.

00:32:56.160 | So it is a little bit exhausting.

00:32:58.600 | - I think that that's what people don't realize

00:33:00.200 | is when this thing got very popular,

00:33:03.120 | the two or three days after an episode comes out

00:33:06.640 | becomes your texts, your email, your DMs,

00:33:10.160 | and your replies become filled, especially again.

00:33:13.560 | - I would encourage you to keep doing this thing

00:33:15.280 | and just to turn off comments and don't look back.

00:33:17.880 | It's hard for the first few weeks

00:33:20.000 | and then you realize 99% of people who comment

00:33:22.880 | have nothing important or useful or interesting to say,

00:33:25.800 | like zero, like negative zero.

00:33:28.040 | And you forget that there's like 99.999% of the world

00:33:32.120 | that just reads your content

00:33:33.840 | and couldn't even care about their comments.

00:33:37.080 | - Yeah, that's a good point.

00:33:37.920 | - And I would just, I would focus on what you have to say

00:33:40.720 | and ignore all these other.

00:33:42.600 | - Delete Twitter.

00:33:43.440 | - I agree that would make it less exhausting,

00:33:44.920 | but it would still be time consuming.

00:33:46.320 | There is a bunch of business blogs I want to get done, so.

00:33:49.280 | - I mean, I said, you take two weeks off,

00:33:50.680 | you come back and see how you feel.

00:33:52.000 | I mean, you can do it week by week too.

00:33:53.920 | I mean, just take one week off and see it.

00:33:56.680 | See how it feels, see if you catch up.

00:33:57.520 | - I think you'll miss it.

00:33:58.360 | - And then you'll be back.

00:33:59.200 | - Yeah, he'll be back.

00:34:00.040 | - Of course he'll be back.

00:34:01.880 | - Great, great question from Nathan.

00:34:04.040 | Thank you for your participation, Nathan.

00:34:06.840 | Next question, I actually like this one.

00:34:08.440 | I'm going to pull it out.

00:34:09.320 | It's an email question from Juan T.

00:34:12.200 | - Oh, hey, Juan T.

00:34:13.320 | - Juan said, "Bill Gurley recently put out a piece

00:34:15.640 | "explaining how this might be as good a time

00:34:18.240 | "as in a decade to build a company.

00:34:20.320 | "How are you guys seeing your own portfolio companies

00:34:22.520 | "trying to take advantage of the situation?"

00:34:24.480 | And I guess I'll add, do you guys agree?

00:34:25.880 | And how do you think about this as a moment

00:34:28.360 | for company building?

00:34:29.960 | - I could take that one.

00:34:31.840 | I am seeing a lot of the companies

00:34:33.880 | that had done a great job racing around,

00:34:37.520 | seed round, series A, never got product market fit,

00:34:40.120 | now wrap it up, right?

00:34:41.720 | They're shutting down, they're doing the wind down process.

00:34:43.880 | And then we're seeing lists of very talented people,

00:34:47.880 | and I've talked about this before on the show,

00:34:49.000 | the consolidation of talent behind the winning ideas,

00:34:52.440 | the experiments that actually worked,

00:34:55.000 | products that got some traction,

00:34:56.680 | are now having an easier time hiring talent.

00:34:59.560 | And so to Bill's point, he's got a lot more experience

00:35:01.760 | in this than the four of us put together,

00:35:03.840 | is absolutely right.

00:35:04.680 | When you build in this down market,

00:35:06.400 | yeah, it's harder to raise money, of course,

00:35:08.280 | but talent is what makes great products,

00:35:11.360 | and products that delight customers get the flywheel going.

00:35:15.040 | And if you survive through this, and you have that talent,

00:35:18.080 | you're not going to face 20 copycats,

00:35:21.320 | and there's not 50 new products coming out a day.

00:35:24.560 | People have more time to actually engage and try a product,

00:35:28.080 | which they've been burnt out on.

00:35:29.240 | And the peanut butter spreading,

00:35:31.280 | we have this thin layer of peanut butter talent,

00:35:33.440 | now it's getting consolidated in the winter.

00:35:35.240 | So absolutely a great time for five CEOs and founders,

00:35:39.840 | or 10 founders across five companies,

00:35:42.200 | to consolidate down to two, do those tuck in acquisitions,

00:35:45.360 | and get focused, and build really good teams,

00:35:47.720 | and cut the weakest people on the teams.

00:35:49.200 | There's a lot of weak talent that have been overpaid,

00:35:52.040 | and aren't actually contributing to these teams,

00:35:53.720 | and they need to get cut,

00:35:54.760 | and then you pull in the all stars.

00:35:56.120 | It's a fantastic time, he's 100% right.

00:35:58.960 | - All of the, if you look back in history since 2000,

00:36:02.000 | all of the best performing funds of all times,

00:36:04.040 | were the ones that were formed,

00:36:05.640 | right in the middle of the downturns, '03, '08, '09.

00:36:08.560 | These are the vintages that have always been the best.

00:36:10.480 | And what that means, it's a proxy for investing,

00:36:12.600 | which is, it's the hardest time right now.

00:36:14.800 | It's when you have the shakiest hand,

00:36:17.360 | when you're writing the check,

00:36:18.840 | but it'll probably be where all of the real money is made,

00:36:22.200 | or the real generational wealth,

00:36:24.240 | both for the entrepreneurs who have the courage to start,

00:36:27.280 | and the investors who have the courage to invest.

00:36:29.680 | There was a story that I heard in New York.

00:36:33.280 | I was talking to a really well-known hedge fund,

00:36:36.920 | or family office,

00:36:38.000 | and they were talking about how they were meeting

00:36:41.440 | with a CEO of a FinTech unicorn,

00:36:43.600 | very well-known FinTech unicorn.

00:36:45.320 | And they said they left the meeting, and they said,

00:36:48.760 | "This person had an unbelievable disrespect for money."

00:36:53.520 | And it was the most arrogant interaction

00:36:55.640 | that they had ever heard,

00:36:56.520 | and they said, "Under no circumstances

00:36:58.120 | would we invest in this guy and this company, at any price."

00:37:01.560 | And lo and behold, a year later,

00:37:03.760 | that company is now visibly going through

00:37:05.600 | a bunch of hiccups.

00:37:06.960 | And it just reminds me that, Jason,

00:37:10.680 | we've always had two problems when times are good.

00:37:14.400 | Problem number one is that there's never been

00:37:16.680 | a check and balance on that kind of behavior,

00:37:18.880 | a lack of respect for capital,

00:37:20.840 | and almost a disregard for business models,

00:37:24.080 | which is just inexcusable.

00:37:25.560 | And I think it's partly the fault

00:37:28.240 | of a very young entrepreneur,

00:37:29.480 | but it's also partly the fault of a board

00:37:31.160 | who doesn't know how to direct that person.

00:37:32.600 | - Enablement is real, yeah.

00:37:34.120 | - But then the second thing is we've always had

00:37:36.440 | this big tech put on the table,

00:37:39.440 | where every time you would try to really hone in

00:37:43.280 | on running a lean, highly efficient organization,

00:37:46.960 | the alternative would be to go work at Google,

00:37:49.240 | Facebook, Apple, Amazon, Microsoft,

00:37:51.280 | where the terms are just completely different

00:37:54.440 | to what the experience was at a startup.

00:37:57.560 | And the bigger the gap, the harder it was for you

00:38:00.560 | to be able to hire and retain good people

00:38:02.240 | without just copying them.

00:38:04.200 | And now that that's also coming off the table,

00:38:06.680 | that is a key moment.

00:38:07.800 | So Gurley is 100% right.

00:38:10.000 | There is no longer the big tech put.

00:38:11.960 | Those are the generals that are about to get shot

00:38:14.080 | over the next eight to 12 months, in my opinion,

00:38:16.160 | in the public markets,

00:38:17.320 | in terms of market cap and employment and perks.

00:38:20.760 | And then second is that these really thoughtful investors

00:38:24.960 | who felt pretty deeply disrespected

00:38:27.400 | will now be able to call the shots.

00:38:29.240 | And these founders will have to come back hat in hand

00:38:32.740 | and either apologize

00:38:33.720 | or just completely find a different religion.

00:38:36.080 | And I think in that,

00:38:36.960 | you'll have a lot of amazing opportunities

00:38:39.520 | to build companies.

00:38:41.000 | - I think it's well said.

00:38:41.820 | Sax, what are you saying?

00:38:43.400 | - Yeah, I think that's right.

00:38:44.280 | I mean, look, when times are as frothy as they were,

00:38:46.400 | a lot of bad ideas get funded

00:38:48.140 | and there's a lot of bad behavior that occurs.

00:38:51.040 | I don't think all of it's intentional.

00:38:52.520 | Some of it is just the lack of discipline

00:38:54.600 | that when capital is just so freely available,

00:38:56.680 | people are building their businesses

00:38:58.720 | in ways that we're optimizing solely for one variable,

00:39:02.320 | which was top line growth.

00:39:03.720 | They just weren't paying enough attention

00:39:05.180 | to gross margins or burn.

00:39:08.040 | And when you then have a downturn

00:39:10.480 | and capital is not so available,

00:39:11.680 | you have to build your business

00:39:12.680 | in a much more capital efficient way.

00:39:14.480 | And you can't create fake businesses

00:39:16.400 | where you're buying growth

00:39:18.020 | that's not economically justified,

00:39:20.640 | where you've got negative uniconomics around the growth.

00:39:23.200 | So I think that this downturn

00:39:25.640 | is going to create a shakeout.

00:39:27.600 | It's gonna weed out bad ideas, bad practices,

00:39:31.920 | and a lack of sort of focus. - Bad boards.

00:39:34.960 | - Bad boards and-

00:39:36.720 | - Or also bad investors. - And one trick ponies.

00:39:38.680 | - Or no boards.

00:39:40.000 | - Bad allocators.

00:39:41.160 | - One trick ponies.

00:39:42.400 | There's just a lot of one trick ponies out there

00:39:44.100 | who've optimized growth, but don't have a real business.

00:39:47.220 | And it's gonna require entrepreneurs

00:39:50.620 | to play sort of more like multivariable calculus or math,

00:39:55.620 | not just single variable.

00:39:57.260 | - It is extremely difficult to convert TVPI to DPI.

00:40:00.680 | You know, the value of paper values

00:40:03.780 | into actual distributions, and that takes a skilled hand.

00:40:06.760 | And I think that a lot of young folks

00:40:11.860 | were hired into venture

00:40:13.540 | that fundamentally did not know what they were doing.

00:40:16.660 | They've neither ever built a company

00:40:18.160 | or helped build a company,

00:40:19.260 | or actually learned how to generate returns.

00:40:22.380 | But they became very good

00:40:24.440 | at buying free call options on companies.

00:40:27.620 | You know, I remember like a lot of people,

00:40:29.020 | the way that you, these young people,

00:40:30.700 | I remember I heard a story

00:40:31.700 | that you would sell against Gurley, right?

00:40:34.320 | So let's just say you were trying to do a deal

00:40:35.700 | and Bill gives you a term sheet from Benchmark

00:40:38.500 | and you get somebody else.

00:40:40.140 | The young folks were like,

00:40:40.980 | "Oh, Bill's too negative and he doesn't get it."

00:40:43.300 | And they would try to convince these entrepreneurs

00:40:45.420 | that, you know, these rainy days don't happen.

00:40:47.940 | My experience with Gurley

00:40:48.980 | is he is the most sophisticated investor of our generation.

00:40:53.180 | And what I mean by that is, you know,

00:40:55.560 | he was trained as an equity analyst

00:40:58.500 | that really understood business models and cost of capital.

00:41:02.560 | And so in a moment like this,

00:41:05.260 | the way that Gurley would help you on a board

00:41:07.080 | is meaningfully more important

00:41:08.380 | than how some, you know, middling VP

00:41:10.620 | at some rando startup who's now a, you know,

00:41:14.580 | junior partner at a venture firm,

00:41:16.180 | because that person has literally no clue.

00:41:18.340 | And so these companies are gonna go through

00:41:20.820 | a very difficult moment,

00:41:22.500 | which again is the reason why a good steady hand

00:41:26.460 | who knows what they're doing

00:41:27.300 | will make a ton of money in this next cycle.

00:41:29.580 | - And for people who don't know TVP,

00:41:30.980 | let me just give you a quick definition.

00:41:32.780 | This is the total value divided by the paid-in capital.

00:41:35.280 | So total value is distributions,

00:41:37.960 | like, "Hey, here's your Robinhood stock,

00:41:39.780 | here's your Ubersock, here's cash,

00:41:41.780 | plus the net asset value."

00:41:42.940 | What's that fancy word for the value of the shares

00:41:46.300 | of the companies that haven't had an exit.

00:41:48.460 | And so you divide those two numbers,

00:41:49.700 | you get a ratio 1.5, 1.2, et cetera.

00:41:52.580 | But to Shmott's point,

00:41:54.380 | net asset value is debatable in some of these, right?

00:41:57.220 | And distributions are what matter.

00:41:58.580 | You can't eat the IRR.

00:42:01.640 | You gotta eat the stuff that's been distributed.

00:42:03.940 | - All right, let's keep going.

00:42:05.180 | I'll do one more.

00:42:06.380 | I'm gonna skip over.

00:42:08.180 | Well, I'll just, the question on Twitter

00:42:10.900 | that got the most votes was,

00:42:12.260 | "What's the exact net worth of each bestie?"

00:42:15.260 | I would make the case

00:42:16.980 | that that's probably not the best way to measure oneself.

00:42:20.260 | And I don't think we're gonna do it.

00:42:22.860 | I also would argue that we're probably all exposed

00:42:26.140 | to a lot of fuzzy math with private assets that we own

00:42:28.660 | and in terms of companies we're invested in.

00:42:30.140 | - Also, who cares?

00:42:30.980 | Like, how does that correlate with happiness in life?

00:42:33.100 | It doesn't.

00:42:33.940 | - Right, so it doesn't really-

00:42:34.760 | - Stupid question.

00:42:35.600 | - And I don't think it's a big focus

00:42:36.460 | in terms of objectives.

00:42:38.540 | I'll say the next one that got a lot of votes,

00:42:41.140 | which I really like.

00:42:42.260 | - It's a lagging indicator and a byproduct of what we do.

00:42:45.060 | There are moments when what we do reflects in value

00:42:50.060 | that frankly, where we are over-earning.

00:42:52.500 | And then there are periods

00:42:53.620 | where what we do is under-reflected and we are under-earning.

00:42:57.260 | And so the through line has to be

00:42:59.820 | that you need to survive in both good times and bad times,

00:43:02.060 | which means you gotta like what you're doing.

00:43:04.540 | And if you get caught up in a numerical number,

00:43:06.660 | there's all kinds of math you can do

00:43:07.860 | to make it look a lot bigger than it is,

00:43:09.780 | but it's all meaningless.

00:43:10.820 | - Yeah, I would argue as long as you're actively

00:43:13.380 | developing yourself over time,

00:43:15.740 | the weighing machine will do its job.

00:43:17.980 | - Somebody told me in my 20s when I was at AOL,

00:43:22.820 | he said, "If you're," because at the time,

00:43:26.380 | I grew up on welfare, I thought the goal was to make money.

00:43:29.540 | I didn't know any better.

00:43:30.940 | I've learned later that there's a lot more leading indicators

00:43:34.740 | of happiness and things that actually create happiness.

00:43:38.540 | - White truffles.

00:43:39.380 | - White truffles.

00:43:40.660 | - I was gonna say friendship, my family, but yeah.

00:43:42.740 | - Friendship and family.

00:43:43.580 | Laughs, I define it as laughs and friendships.

00:43:46.020 | - Friendships.

00:43:46.860 | - But he said to me, "Your goal should be

00:43:49.820 | to just be in the upper few percent of your age bracket

00:43:53.740 | and just enjoy what you're doing."

00:43:56.300 | And he said, "Let time take care of everything else."

00:43:58.780 | Because as long as you find something you decently enjoy

00:44:02.620 | and are good at, you'll just get better and better

00:44:05.060 | at that thing.

00:44:06.240 | And then at some point, you will lose track

00:44:09.440 | of what the measurement of that is

00:44:12.340 | because you're just too caught up

00:44:13.780 | in how much you enjoy doing the thing.

00:44:17.280 | And I thought that he had no idea what he was talking about.

00:44:20.760 | And now 25 years later, I can tell you he was totally right.

00:44:24.660 | Totally right.

00:44:27.120 | - Yeah.

00:44:28.180 | By the way, this was a question I was trying to skip over.

00:44:31.020 | - No, but it led to a good fork, yeah.

00:44:33.260 | - Okay.

00:44:34.100 | - What is happiness?

00:44:34.920 | - Yeah.

00:44:35.760 | - I think after observing outcomes for 25 years in tech,

00:44:40.060 | what I would say is that if you're smart, hardworking,

00:44:43.640 | don't have behaviors that sabotage yourself

00:44:46.180 | and take intelligent risks,

00:44:48.100 | you will be successful in this business.

00:44:49.780 | I mean, technology is such a wind at your backs.

00:44:53.240 | It's such an engine of wealth creation.

00:44:54.780 | How can you not do well?

00:44:56.580 | But the exact magnitude of how well you do,

00:44:58.940 | I think is ultimately,

00:44:59.860 | it is substantially affected by timing.

00:45:02.340 | And like if you were employee, whatever number X at Google,

00:45:07.340 | you're gonna do better than most founders,

00:45:10.220 | even of a unicorn company.

00:45:11.540 | And when you found your company

00:45:13.340 | and then when you exit what the market is doing,

00:45:16.180 | those things have a huge impact on the magnitude.

00:45:20.080 | So whether you end up being a billionaire,

00:45:23.660 | a centimillionaire, a decamillionaire,

00:45:25.840 | whatever you want to,

00:45:26.680 | those things are very affected by timing and chance,

00:45:29.420 | but not whether you're gonna be successful

00:45:32.860 | at a substantial level.

00:45:35.020 | And so just be smart, be hardworking,

00:45:38.180 | don't sabotage yourself, get into tech and you will do well.

00:45:42.500 | - Trust the process.

00:45:43.700 | Trust the process.

00:45:44.540 | - The exact amount of how well you do

00:45:45.500 | will be dependent on some stochastic factors,

00:45:49.140 | but not the fact that you're gonna do well.

00:45:50.700 | - We are enormous beneficiaries of having been born

00:45:54.580 | when we were, because we were a bunch of late 40

00:45:57.880 | and early 50 somethings that in the prime of our career

00:46:02.480 | in tech, the Federal Reserve took rates to zero.

00:46:06.620 | And we had no idea a priori how important that would be

00:46:11.200 | in all of our outcomes, but they were.

00:46:13.520 | - And even more importantly,

00:46:15.320 | PCs, internet and mobile happened.

00:46:17.280 | - All of that hard work was done beforehand

00:46:20.160 | by an entire court of people that had to fight

00:46:22.160 | much stronger headwinds than we had to fight.

00:46:24.720 | So, David, I just wanna build on that.

00:46:26.520 | We were extraordinarily lucky.

00:46:28.880 | And so don't get caught up in that

00:46:31.800 | because there's all these factors you cannot control.

00:46:34.700 | - I'll say one more thing

00:46:35.540 | that I think is the most important observation I've made

00:46:39.120 | in terms of whatever it is, building wealth over time

00:46:43.680 | is to make sure you're building equity in yourself.

00:46:47.920 | If you're in a services business and every day,

00:46:51.120 | and whether that's serving the clients

00:46:52.880 | of the company you work for,

00:46:54.200 | or just serving clients on behalf of yourself,

00:46:57.140 | and everything you do is a transaction,

00:46:59.520 | and that transaction doesn't build on itself,

00:47:01.920 | doesn't compound value in some way,

00:47:04.600 | then you're missing out on an opportunity.

00:47:06.300 | Every year that goes by that you're earning income

00:47:09.120 | or you're not building equity is a non-compounding year.

00:47:13.640 | And it's compounding equity value

00:47:16.680 | that I think ultimately pays off for you as an individual.

00:47:19.480 | And I can give a lot of examples of this,

00:47:21.120 | but if you're in a, let's say a brokerage business,

00:47:24.820 | and you just do deals,

00:47:26.600 | and you might have a good year, you might have a bad year.

00:47:28.760 | The real question you need to ask yourself is,

00:47:31.080 | what is compounding?

00:47:32.120 | Are you growing a client base?

00:47:34.040 | Are you growing your skillset?

00:47:35.640 | Are you next year able to do more things

00:47:38.400 | or have more options than you had this year?

00:47:40.440 | And if the number of options you have

00:47:41.840 | is declining or static every year,

00:47:44.040 | then you're limiting your equity value,

00:47:45.480 | and that ultimately will translate

00:47:46.680 | into limited wealth creation.

00:47:48.040 | - Can I chime in on that point around equity?

00:47:49.800 | So when I discovered what equity was,

00:47:52.760 | this was when I was in law school,

00:47:54.140 | and actually the guy who explained it to me

00:47:55.380 | was Antonio Gracias, a light bulb really went off for me

00:47:58.760 | because my dad is a doctor,

00:48:00.840 | and I was on a path to becoming a lawyer.

00:48:03.520 | And in both those cases, you're a professional,

00:48:05.560 | the way you get paid is you more or less

00:48:08.160 | charge an hourly rate.

00:48:09.920 | And so the amount of money you can make is capped, right?

00:48:13.160 | Just take the number of hours in the day and in the week,

00:48:15.440 | multiply it by your rate,

00:48:17.240 | and that's the most money you can make in a year.

00:48:19.400 | And the difference between that and equity

00:48:23.040 | is with equity, you own a piece of a business,

00:48:27.200 | and that business could be ultimately worth any amount,

00:48:31.360 | and so your equity could therefore be worth

00:48:33.880 | virtually any amount, and so you're uncapped.

00:48:36.840 | And so just, if you wanna have outside success,

00:48:39.920 | you have to have equity in something.

00:48:42.360 | I think that is exactly right.

00:48:43.680 | If you're just basically working for wages,

00:48:48.080 | even if you are the best at what you do

00:48:50.120 | and you get paid an insane hourly rate,

00:48:53.000 | again, you can be successful,

00:48:54.520 | but you're not gonna be uncapped.

00:48:56.640 | And so that's the beauty of Silicon Valley

00:48:59.200 | is all these companies offer equity to everybody.

00:49:01.840 | - And it's not just shares in something.

00:49:04.200 | You can actually get equity and create leverage in your life

00:49:07.320 | in this era more than any human has ever had

00:49:10.160 | in any era prior because of software

00:49:13.400 | and computing and automation.

00:49:15.160 | You can create a website that prints cash for you every day

00:49:17.960 | if you wanted to.

00:49:19.040 | You can create a service that you get leverage out of,

00:49:21.440 | and there's equity value in that.

00:49:23.200 | And I think that's really key

00:49:24.480 | because then you can go build another one, another one,

00:49:26.080 | and you're building value over time.

00:49:28.440 | And that's just the most simplistic example

00:49:31.120 | of how technology today provides leverage

00:49:33.640 | that can really allow anyone to pursue a path of equity.

00:49:36.920 | - And I think you made a good point about

00:49:39.120 | what are you getting leverage off of?

00:49:41.520 | - Yeah.

00:49:42.360 | - There's a bunch of different things

00:49:43.200 | you can get leverage off of.

00:49:44.040 | - It used to be labor, right?

00:49:44.880 | It's not anymore.

00:49:45.960 | - So the old way was leverage off labor.

00:49:47.920 | And I guess if you were to own like a consulting firm

00:49:50.920 | or like some sort of factory,

00:49:52.840 | then the more people you have working,

00:49:54.960 | the more money you'd make.

00:49:56.960 | The other way would be like,

00:49:58.200 | you can get leverage off capital, like a fund manager,

00:50:01.480 | or you can get leverage off of technology

00:50:03.640 | 'cause software can basically create

00:50:05.040 | these super scaled outcomes.

00:50:06.480 | So you need to figure out like

00:50:07.480 | what is it you're getting leverage off of?

00:50:09.480 | - Yeah.

00:50:10.320 | So I'll do the last one,

00:50:11.160 | which I thought was a really good question.

00:50:13.000 | And it got a lot of votes from Marcos Ortiz.

00:50:16.960 | If you had to start from scratch, no money, no connections,

00:50:19.840 | only the knowledge you have right now and 100 bucks,

00:50:23.040 | what would you build in 2022?

00:50:24.840 | - I would build something in energy transition

00:50:29.080 | or in life sciences.

00:50:30.520 | - With $100?

00:50:31.360 | - Yeah.

00:50:34.720 | - I would build a startup incubator,

00:50:38.240 | venture fund of some type.

00:50:40.880 | A way to fund entrepreneurs

00:50:42.640 | and just be a capital allocator much earlier in my career.

00:50:45.600 | - I would create a B2B software company that,

00:50:51.120 | actually I'm already creating it.

00:50:52.720 | So I haven't unveiled it yet,

00:50:54.080 | but there's something I'm incubating right now.

00:50:55.840 | - Go David, go.

00:50:56.800 | - Whoa, whoa, whoa, where's the bet week?

00:50:58.480 | Wait, whoa, whoa, wait.

00:50:59.560 | - Wet my beak. - You wet your beak.

00:51:00.720 | What is going on here, Sax?

00:51:02.960 | - I haven't gotten the subscription documents.

00:51:04.160 | - Have you raised money for it?

00:51:05.360 | - No, I have not raised money yet.

00:51:06.560 | When I raise money, you guys can invest.

00:51:07.400 | - I have not gotten my subscription documents, sir.

00:51:09.440 | - You can think of this idea as Yammer 2.0.

00:51:11.960 | So J. Cal, you're not in because you criticize Yammer, but.

00:51:14.400 | - It was a joke, I gave you the,

00:51:16.160 | I let you win TechCrunch 50.

00:51:17.800 | I put the fucking fix in for you.

00:51:19.400 | - David, just to put my pitch in,

00:51:20.880 | I ran AIM and ICQ, helped Facebook,

00:51:24.200 | was an investor in Yammer,

00:51:25.480 | was the Series A investor in Slack.

00:51:27.120 | So I'm ready for you.

00:51:28.320 | - Yeah, you were there for us when we needed you

00:51:31.280 | back at Yammer days, unlike J. Cal.

00:51:33.400 | - What are you talking about?

00:51:34.440 | Your wife came to my line and they were like,

00:51:36.520 | "Sax has to win TechCrunch 50."

00:51:39.360 | - Don't worry, you're all in.

00:51:40.200 | - Let me in, Sax, let me in, let me in.

00:51:41.040 | - When I do the round, you guys are in.

00:51:42.720 | - Let me in, let me in.

00:51:43.560 | Let me lead it.

00:51:44.400 | - Let us do the pre-round round.

00:51:46.960 | We want to do the pre-round round.

00:51:48.520 | - Pre-round, pre-round, pre-round.

00:51:51.360 | - Thank you.

00:51:52.200 | - Did you just agree on TV?

00:51:54.280 | - Well, assuming, hold on,

00:51:55.320 | there's one thing you have to do,

00:51:56.320 | which is you've got to rip out Slack and use this instead.

00:51:58.880 | - Yes, 100%, 100%.

00:52:00.560 | I will start the all-in community.

00:52:02.400 | - I'm going to be very honest with you.

00:52:04.280 | The day I left Facebook, I stopped using it.

00:52:07.200 | The day we sold, we distributed Slack, stopped using it.

00:52:10.520 | So don't worry about me.

00:52:11.480 | I am 100% aligned with you.

00:52:13.680 | - I'm all in, I'm all in, absolutely.

00:52:15.520 | All right, let's do the show.

00:52:16.640 | - Let's do the show.

00:52:18.320 | - Freeberg, you didn't answer that question.

00:52:19.680 | What would you do?

00:52:20.520 | - Well, actually, I would get some water vaporizers

00:52:23.320 | and then I would get some molecules

00:52:25.480 | and I would make a new super protein

00:52:27.880 | that was made out of, God, sorry.

00:52:30.440 | - No, no, keep going, I like it.

00:52:32.640 | - I think it'd be something with the protein slurry.

00:52:34.720 | You'd make some kind of steak

00:52:36.040 | that tastes better than steak. - Protein slurry.

00:52:38.600 | - Some sort of protein.

00:52:39.440 | - I would definitely build a business again.

00:52:41.640 | I think the challenge is,

00:52:44.440 | as you move past that stage in your career

00:52:48.680 | where you have the willingness and the time

00:52:51.080 | to be 120% building one product every day,

00:52:56.080 | it's really hard to go back to that.

00:52:59.080 | And I think if I was in a position again

00:53:00.600 | where I had no money and had no connections.

00:53:04.040 | - I think that's the key part of the question,

00:53:05.600 | not the $100 part.

00:53:07.200 | - Yeah, I think I would go back to building something.

00:53:09.680 | I do think the intersection of life sciences with software

00:53:13.080 | creates this era of opportunity.

00:53:15.920 | It would probably be something in the realm

00:53:17.760 | of AI/ML meets life sciences

00:53:21.400 | where you can actually work in a leveraged way with software

00:53:24.480 | to drive outcomes in these important markets.

00:53:26.920 | - I would actually create a robotic cat.

00:53:30.160 | - Friedberg and I could have been co-founders.

00:53:31.800 | - We could have started something.

00:53:33.640 | - Maybe we can still.

00:53:35.040 | - Oh, here we go. - Not too late.

00:53:37.120 | - The co-founders.

00:53:38.120 | - Sax, we'll let you in the pre-round

00:53:39.560 | if you let us in your pre-round.

00:53:41.600 | - Okay, sounds good.

00:53:42.680 | - All right, Jake, you wanna take us forward?

00:53:44.800 | - Should we go forward?

00:53:45.640 | Okay, let's see what's on the docket.

00:53:47.400 | We've got Russia's invasion of Ukraine.

00:53:53.280 | - You had Biden last week saying

00:53:56.000 | we're facing the risk of Armageddon.

00:53:57.360 | How is that not the top story?

00:53:59.080 | - Go, Saxy Poot, go take it.

00:54:00.920 | - All right, here we go.

00:54:01.800 | Let me just queue it up for Sax.

00:54:03.480 | Biden last week said we're facing risk of Armageddon.

00:54:05.400 | That's your tee up.

00:54:06.600 | - Okay, here we go.

00:54:07.440 | - And then Leon Panetta, just let's tee it up, J.Cow.

00:54:10.480 | We don't need, everyone knows what's going on.

00:54:12.200 | Then you had Leon Panetta, who was the former

00:54:15.320 | Secretary of Defense and Director of Central Intelligence

00:54:17.880 | wrote an op-ed for Politico saying that

00:54:21.640 | intelligence analysts have now raised the probability

00:54:26.400 | of a use of a tactical nuclear weapon in Ukraine

00:54:28.840 | from one to 5% at the beginning of the war

00:54:31.840 | to 20 to 25% now is what he says.

00:54:35.520 | So, and I don't think he'd be saying that

00:54:38.200 | if this wasn't pretty much conventional wisdom

00:54:40.320 | in Washington now.

00:54:41.160 | I mean, Panetta is sort of a very respectable figure

00:54:45.560 | in the Beltway.

00:54:46.920 | - And Biden said it, right?

00:54:47.880 | For the first time two weeks ago.

00:54:48.720 | - And Biden said that we're facing

00:54:49.920 | the most dangerous situation and the highest risk

00:54:53.160 | of nuclear war since the Cuban Missile Crisis.

00:54:55.360 | He called it the risk of Armageddon.

00:54:57.480 | The problem is that nobody is willing to say

00:55:01.800 | what we should be doing differently to avoid this situation.

00:55:05.400 | So, people are always attacking us

00:55:07.200 | for having a point of view on foreign policy.

00:55:09.200 | First of all, this affects us.

00:55:10.400 | I don't know why we're not allowed to have a point of view,

00:55:12.640 | but in our business thinking,

00:55:14.600 | where there's an existential issue,

00:55:16.840 | you have the attitude of drop everything

00:55:19.040 | and figure this out.

00:55:20.160 | If somebody told you that there's a 25% chance

00:55:22.960 | of your company blowing up, maybe in the next few weeks,

00:55:26.160 | you would drop everything and focus on that problem.

00:55:28.720 | But it's like, after the Armageddon comments,

00:55:31.160 | it's like the media just passed over it.

00:55:33.600 | It's like, oh, this is like crazy Biden or whatever.

00:55:36.400 | It was minimized.

00:55:37.240 | It was contextualized.

00:55:38.800 | The White House walked it back.

00:55:40.520 | Nobody's really focusing on this

00:55:42.120 | and what we should be doing differently.

00:55:43.240 | And in fact, what Panetta recommends

00:55:45.320 | and Petraeus said the same thing,

00:55:47.360 | is that if Russia uses attack nuke in Ukraine,

00:55:50.760 | then we should respond by attacking Russia directly.

00:55:54.760 | Now, if we do that, we are literally in World War III.

00:55:57.840 | And remember, at the beginning of the war,

00:55:59.280 | Biden was really clear that we weren't gonna

00:56:01.600 | get directly involved.

00:56:02.800 | He vetoed the idea correctly of the no-fly zone,

00:56:06.560 | which would have required us to shoot down Russian planes.

00:56:09.360 | Biden, remember he was asked in the press conference

00:56:11.400 | at the beginning of the war by Lester Holt.

00:56:12.720 | He said, Holt said, "Mr. President,

00:56:14.960 | "what if Americans are trapped behind enemy lines in Ukraine?

00:56:17.920 | "Would you send in American troops to go get them?"

00:56:20.440 | Biden said, "No."

00:56:21.880 | I think very properly said no, because he said,

00:56:24.520 | "Listen, we do not wanna risk World War III."

00:56:26.960 | But now, because of mission creep and a slippery slope,

00:56:30.360 | and we've all gotten more involved in this war,

00:56:32.240 | we've gotten more emotionally committed,

00:56:33.760 | you now have Panetta and Petraeus calling for us

00:56:36.560 | to directly attack Russia and get in World War III.

00:56:40.320 | The Russians almost certainly would respond with nuclear

00:56:43.200 | because that's all they've got.

00:56:44.160 | They don't have the conventional forces to stand up to us.

00:56:47.160 | So look at how close we have now gotten

00:56:50.120 | to the brink of a nuclear showdown.

00:56:52.280 | And has anybody reassessed?

00:56:54.400 | Is anyone calling for us to reevaluate?

00:56:56.560 | Because that's the conversation

00:56:57.720 | we should be having right now.

00:56:58.880 | - And, Freeberg, this brings up two points

00:57:01.400 | that I think you can comment on.

00:57:03.840 | Naval, actually the founder of AngelList, Angel Investor,

00:57:08.160 | and just public thinker, I would say public intellectual.

00:57:12.000 | He came on to call in with the two of you,

00:57:14.480 | and he outlined who does get to have an opinion

00:57:18.200 | on Ukraine and other issues, which has dovetailed

00:57:21.160 | with this, who gets to be an expert in the world today?

00:57:25.560 | And of course, at the same time,

00:57:27.280 | not only Sachs has been commenting on,

00:57:28.840 | "Hey, what's the off ramp here?"

00:57:30.320 | Elon has been talking about, "Hey, how do we get out of this?

00:57:33.280 | Do we have some votes by these regions

00:57:37.720 | that have been annexed or that are in dispute?"

00:57:40.640 | AOC now is getting criticized on,

00:57:42.440 | and people shouting her down at a public event today

00:57:45.160 | or yesterday, that she's a warmonger

00:57:47.440 | and she won't speak out against war.

00:57:49.520 | How do you frame the public dialogue about this, Freeberg?

00:57:53.320 | And then do you see a potential off ramp here

00:57:55.320 | other than Putin leaves Russia,

00:57:57.400 | which is, I think, the public stance by a lot of folks.

00:58:01.080 | Putin can end this, he just has to leave Ukraine

00:58:03.360 | in order for this to end.

00:58:05.160 | So two questions there for you, Freeberg.

00:58:06.680 | - It's very hard to have good dialogue

00:58:11.680 | about any situation where an argument could be made

00:58:17.480 | on the grounds of morality in an absolute sense,

00:58:22.320 | making it really difficult to have a discourse

00:58:25.360 | around what the right thing to do is,

00:58:27.400 | because you don't agree fundamentally

00:58:29.680 | on the objective you're shooting for.

00:58:31.880 | One side says the objective is to preserve

00:58:35.640 | the integrity of democracy and the freedom of people.

00:58:40.640 | And the other side says the objective should be

00:58:43.920 | to secure the interests of the West and the United States

00:58:47.840 | and preserve the world from nuclear holocaust.

00:58:51.360 | I think that's what makes this a challenging conversation.

00:58:55.000 | The objective can be reframed,

00:58:58.320 | and then from that objective,

00:59:00.080 | each side can make their own case

00:59:02.120 | without being forced to take in the point of view

00:59:05.320 | of the other side.

00:59:06.800 | And it's why we're at a bit of a standstill,

00:59:09.080 | and it's also why it's so easy to get swept up

00:59:12.240 | in a mass point of view, a coalesce point of view

00:59:16.240 | of the masses that makes one feel good

00:59:20.080 | about what may end up being a very bad situation.

00:59:23.120 | It feels good to say,

00:59:24.280 | I'm doing this for freedom of the people.

00:59:26.240 | I'm doing this to save lives.

00:59:28.560 | And the end of the day, it may cause a nuclear war.

00:59:33.160 | And it's okay, because I feel good going into this debate,

00:59:37.000 | that this is the right thing.

00:59:38.120 | It's the morally superior thing to do.

00:59:41.640 | What's very hard is that we can't actually say,

00:59:44.400 | as a group, our objective should be to preserve

00:59:48.520 | the integrity of democracies around the world to an extent.

00:59:52.400 | And that's a nuanced point of view.

00:59:54.760 | To an extent means I'm willing to preserve the democracies

00:59:58.280 | through certain actions,

00:59:59.880 | but I'm not willing to cross a certain line.

01:00:02.360 | And absolutism doesn't need to come into play.

01:00:05.280 | That's what I think is making this

01:00:07.600 | such a very difficult conversation,

01:00:09.760 | and it's why it's so hard

01:00:10.680 | to actually have a conversation around it.

01:00:13.160 | And it's really, I would argue,

01:00:15.480 | the most poignant and the most dramatic moment

01:00:18.800 | in what we talked about earlier,

01:00:20.600 | which is this deep-seated kind of bipolarity.

01:00:24.040 | And once you're sitting on your pole,

01:00:25.760 | you don't wanna come off,

01:00:26.600 | and you don't realize that so much of the dialogue

01:00:28.440 | is in this middle.

01:00:29.880 | And we have to come to some point of view

01:00:31.440 | that maybe this isn't about an absolute outcome.

01:00:33.860 | It's not absolutely gonna be nuclear war,

01:00:36.280 | and it's not absolutely gonna be the end of democracy.

01:00:39.040 | There's some conversation in the middle

01:00:40.680 | that's very difficult to have.

01:00:43.040 | And people that work somewhere in the world,

01:00:46.760 | hopefully ambassadors, foreign policy people,

01:00:49.680 | State Department people,

01:00:51.140 | hopefully are having the more nuanced critical conversation

01:00:54.400 | about how do we resolve to the maximal outcome

01:00:57.440 | that doesn't necessarily take us to an absolute end.

01:00:59.920 | - Chamath, to that point,

01:01:01.240 | it's gonna be an imperfect outcome here.

01:01:03.160 | - I think this is much, much simpler than all of this.

01:01:05.840 | Leon Panetta is a senior counselor

01:01:09.560 | to this defense contracting agency

01:01:11.960 | called Beacon Global Strategies

01:01:13.320 | who works on behalf of Raytheon.

01:01:15.080 | I found that out while Friedberg was talking

01:01:17.720 | in a two-second Google search.

01:01:19.240 | I suspect that if you looked

01:01:21.520 | for Petraeus' conflicts of interest,

01:01:23.360 | you would find that through some Byzantine set

01:01:26.040 | of strategic consulting organizations and whatnot,

01:01:29.800 | he also works on behalf of the defense industry.

01:01:32.480 | So you have these people who will generate more revenue

01:01:36.280 | and more profit if there is a massive war.

01:01:39.640 | And those people have been trying to push us

01:01:42.720 | into a land war in Europe since this whole thing started.

01:01:47.720 | And so this is just yet another attempt.

01:01:50.120 | It's just the most final way of doing it.

01:01:51.900 | So I would just encourage people,

01:01:53.400 | whenever you see all these folks clamoring for war,

01:01:57.940 | is just to keep in mind

01:02:00.480 | that they are riddled with conflict

01:02:02.120 | and that you can find it out.

01:02:03.500 | Again, this information is sitting in plain sight

01:02:05.420 | on the internet,

01:02:06.440 | and you can figure out whether this person

01:02:08.120 | is really advocating a truth that makes sense

01:02:11.680 | or they're getting paid to shill

01:02:13.800 | a revenue generating mechanism

01:02:16.080 | for some part of the military industrial.

01:02:17.560 | - Sax, how much of this is people talking in their book,

01:02:19.800 | their book being the military industrial complex

01:02:21.760 | in your mind?

01:02:23.160 | - I think that's a big part of it.

01:02:24.120 | I think all of these Washington think tanks

01:02:25.800 | are funded by defense contractors.

01:02:28.320 | I think it's short-sighted, obviously,

01:02:29.960 | 'cause if it leads to a nuclear war,

01:02:31.800 | there's not gonna be a defense industry,

01:02:33.560 | there won't be anything left.

01:02:35.280 | But look, I think that Washington is wired for war in part

01:02:40.280 | because there's a huge lobby for it,

01:02:43.520 | for all these defense contractors,

01:02:44.960 | and what's the lobby for peace?

01:02:46.200 | I mean, there's no one really arguing for peace.

01:02:48.560 | - Speaking of this, Elon tweeted.

01:02:51.440 | - I'll tell you what's lobbying for peace.

01:02:54.040 | And I'm gonna connect

01:02:55.120 | what may seem two disparate ideas together.

01:02:57.680 | But the single biggest thing

01:02:59.000 | I think that will prevent nuclear war

01:03:00.880 | is the inflation that we're feeling.

01:03:04.200 | And the reason is because it allows the Fed,

01:03:06.680 | in my opinion, for the first time,

01:03:08.160 | really in the last 15 years, to act properly.

01:03:11.880 | And if they hold the line

01:03:14.280 | and they take interest rates to 4% or 5%,

01:03:17.560 | I think one non-obvious outcome of all of that

01:03:20.080 | is that it becomes extremely expensive,

01:03:23.520 | next to impossible,

01:03:25.600 | to finance military adventurism abroad.

01:03:28.700 | And that's a practical economic outcrop

01:03:31.640 | of really meaningfully high rates greater than zero.

01:03:35.040 | And so I actually think the reality

01:03:37.700 | is that for a lot of these governments,

01:03:39.880 | the more that inflation sticks around,

01:03:43.000 | the stickier it is, the higher rates are in general,

01:03:45.960 | the bigger the problems at home are,

01:03:48.220 | and the less prone they're going to be likely.

01:03:50.240 | I actually think that explains the escalation

01:03:54.320 | of this rhetoric

01:03:55.160 | because people want to try to make this issue

01:03:57.520 | and put it on the table.

01:03:58.720 | But you understand that these folks don't say

01:04:00.720 | it's a 90% likelihood.

01:04:02.480 | They go from 1% to 25%,

01:04:04.600 | which if you understand probabilities

01:04:06.560 | is effectively a left tail risk

01:04:08.560 | that's effectively the same.

01:04:10.320 | And the reason they're trying to do it

01:04:11.600 | is they're trying to get it back, David, as you say,

01:04:13.400 | to timestamp it,

01:04:14.920 | to get it in front of people's perspectives

01:04:17.000 | to make it important,

01:04:18.500 | in a moment where everybody increasingly,

01:04:21.240 | not just in the United States,

01:04:22.460 | but in the UK, in Europe,

01:04:24.400 | are looking internally

01:04:26.140 | and trying to figure out how to keep their economies

01:04:28.760 | in a reasonably functioning way

01:04:30.800 | and how to make sure that their financial

01:04:32.280 | and other infrastructure keeps working.

01:04:34.240 | - So you're saying-

01:04:35.080 | - And that is not necessarily a priority when rates are zero,

01:04:37.960 | but when rates are 4%,

01:04:39.240 | I mean, just by the way,

01:04:40.600 | if you guys saw what happened today,

01:04:42.120 | it was the competing of two narratives this week.

01:04:45.200 | There was the financial narrative

01:04:46.880 | of the UK having to bail out their pension system, right?

01:04:51.240 | Of all of a sudden,

01:04:52.240 | the pensions being forced sellers,

01:04:54.880 | of those forced sellers now, you know,

01:04:57.580 | spilling into the United States debt markets around CLOs

01:05:00.840 | and collateralized loan obligations and junk debt,

01:05:04.160 | which then could theoretically spill as a contagion

01:05:06.460 | to other parts of the market.

01:05:07.580 | That was narrative one.

01:05:09.540 | And all of that, by the way,

01:05:11.020 | is a result of hiding inflation

01:05:12.640 | and the Fed moving up rates

01:05:15.140 | and other countries being forced

01:05:17.200 | to attack inflation with higher rates

01:05:19.400 | and creating all these dislocations,

01:05:21.540 | narrative one,

01:05:22.720 | versus narrative two,

01:05:23.720 | which is, hey, all of a sudden,

01:05:24.840 | we have to put the nuclear risk on the table.

01:05:27.200 | And if you actually saw the print that was spilled,

01:05:31.080 | the disproportionate amount of the rhetoric

01:05:33.120 | actually focused on the former narrative and not the latter.

01:05:36.280 | And so I think that that's why these folks

01:05:40.400 | are escalating the rhetoric

01:05:42.560 | in order to kind of create an equality

01:05:45.800 | so that they get enough print

01:05:47.120 | on that version of the outcome.

01:05:49.320 | - What you're saying is you have the world saying,

01:05:52.440 | we can't afford to have this conflict.

01:05:55.000 | We are broke.

01:05:55.920 | We've got too many chaotic issues.

01:05:57.680 | - The world is saying,

01:05:58.760 | we are increasingly under enormous domestic pressure.

01:06:02.640 | And as a result, we cannot spend on things abroad.

01:06:06.560 | - We can't afford this.

01:06:08.080 | And then the other side saying,

01:06:09.260 | well, we need you to afford this

01:06:10.520 | so nuclear is gonna happen.

01:06:12.200 | There's gonna be a nuclear annihilation.

01:06:13.840 | - And there's a small strain.

01:06:14.680 | - You gotta pay more attention to this.

01:06:15.720 | - There's a small strain of folks

01:06:17.120 | who would economically benefit

01:06:19.160 | and who are now ratcheting up their rhetoric

01:06:21.160 | so that that second path becomes more and more on the table.

01:06:23.840 | - What do you think of this, Freeberg,

01:06:24.880 | this analysis that Shemoth has?

01:06:26.600 | These two polar, these two groups

01:06:31.440 | vying for the attention and or budget of the world.

01:06:35.260 | - The military industrial complex?

01:06:39.560 | - Versus yeah, citizens saying,

01:06:42.160 | our country can't afford this.

01:06:43.440 | We need to focus inward.

01:06:44.800 | - Not citizens, the central banks.

01:06:46.520 | - Okay, but I think the central banks

01:06:48.020 | influenced by citizens, right?

01:06:49.000 | Like this is a whole system here we're talking about.

01:06:51.340 | People are, you know, watching their pensions go away.

01:06:54.600 | They're watching jobs get cut.

01:06:56.520 | - If I was a betting man, I spent,

01:06:58.640 | I would guess that the next half a trillion

01:07:00.520 | to a trillion dollars that is spent

01:07:02.620 | in Western world economies will be to subsidize

01:07:06.160 | something that's broken internally

01:07:08.080 | inside of one of our countries,

01:07:09.880 | whether it's the UK pension system

01:07:11.760 | or whether it's the high yield credit markets,

01:07:14.760 | and it will not be to finance

01:07:16.320 | military adventurism in Russia.

01:07:19.080 | - People, Sachs, hold on. - Just to underscore

01:07:21.120 | that point, so there's an article today

01:07:22.640 | in the Washington Post about how

01:07:24.120 | the US government's debt service

01:07:25.800 | is gonna be around 570 billion this year,

01:07:28.440 | which is a 45% increase.

01:07:31.040 | Biden's budget for 2023 is only 1.6 trillion.

01:07:34.040 | So you're talking about something like over a third now

01:07:37.640 | of the official budget is already going to debt service.

01:07:40.240 | - Because it's not a variable, right?

01:07:41.440 | It's a variable, right? - Yeah, exactly.

01:07:42.640 | 'Cause so much of it is,

01:07:44.640 | it's not locked in a long-term rate.

01:07:46.680 | So because interest rates have gone up so much,

01:07:48.560 | the debt service has gone up

01:07:49.760 | and interest rates are still going up.

01:07:51.620 | And so, Druckenmiller had those points

01:07:54.120 | around how the debt services within a decade

01:07:57.000 | is gonna eat up practically the whole federal budget.

01:07:59.720 | So Chamath is right that we've never really had to choose

01:08:01.840 | between guns and butter before in the past.

01:08:04.440 | It was just, let's just do both

01:08:05.760 | and we'll rack up more national debt.

01:08:08.000 | I do think there will be more and more pressure

01:08:10.800 | to question this type of spending

01:08:13.160 | and why we've already given Ukraine $80 billion in handouts

01:08:17.380 | when we can't afford to basically pay for,

01:08:21.520 | major entitlements at home.

01:08:23.640 | So I think there'll be more pressure.

01:08:25.000 | Now, I don't know if that pressure

01:08:27.160 | is gonna come in time though,

01:08:28.640 | to deescalate this Ukraine war.

01:08:30.320 | - It's not. - And that's what concerns me.

01:08:32.240 | And just to cut to the chase on this,

01:08:34.440 | I think where the rubber meets the road on Ukraine

01:08:37.080 | is Crimea.

01:08:38.040 | And why?

01:08:39.800 | Because the Russians have a major naval base there

01:08:42.520 | at Sevastopol.

01:08:43.520 | It's the home of the Black Sea Fleet.

01:08:46.280 | And they will never give that up.

01:08:48.120 | They are willing to use nukes, I believe,

01:08:50.740 | to basically protect that asset.

01:08:52.680 | It's a vital interest of theirs.

01:08:53.880 | Hold on.

01:08:54.720 | 80% of the population of Crimea, they're Russian.

01:08:58.560 | And three quarters of them, according to polling

01:09:00.520 | that was done by Gallup and by a German polling firm,

01:09:02.800 | so not Russian polls,

01:09:04.400 | indicated that they see themselves as Russian

01:09:06.720 | and wanna be part of Russia.

01:09:07.760 | So if we supported self-determination,

01:09:09.560 | we'd be fine with Crimea being part of Russia.

01:09:11.600 | But here's the rub.

01:09:12.560 | Ukrainian nationalism demands

01:09:14.960 | that every square inch of Crimea goes back to Ukraine.

01:09:18.120 | And it is State Department policy right now

01:09:20.600 | that we will never recognize Crimea as being Russian.

01:09:23.600 | We'll never recognize the annexation,

01:09:25.380 | which happened back in 2014.

01:09:27.260 | So something's gotta give here.

01:09:28.680 | Something's gotta give.

01:09:29.520 | Either we have to sit down, Zelensky,

01:09:33.160 | and say to him, "Listen, you're not getting back Crimea.

01:09:35.640 | "We're gonna make that part of a peace deal."

01:09:37.200 | Or we are gonna back the Ukrainians

01:09:39.860 | in their military effort to retake Crimea

01:09:42.320 | with the result that I think is quite likely

01:09:44.980 | that the Russians will be willing to use a tactical nuke

01:09:47.880 | to prevent their total defeat.

01:09:50.340 | So at some point, we're gonna have to choose here

01:09:52.120 | which of these outcomes do you want?

01:09:53.720 | Do you wanna basically go for a negotiated settlement,

01:09:56.040 | which means telling the Ukrainians

01:09:57.400 | they cannot have everything they want?

01:09:59.360 | Or do you really wanna risk a nuclear war

01:10:01.820 | to take back Crimea, which is Russian,

01:10:04.720 | and the people there see themselves as Russian?

01:10:06.560 | So we need to make a choice here.

01:10:08.640 | - Yeah, yeah.

01:10:09.480 | So Elon put out a tweet for, and got savaged for it.

01:10:13.040 | And he outlined sort of what you're saying here.

01:10:16.160 | So do you think his plan, he said,

01:10:17.760 | "Redo elections of annexed regions

01:10:19.260 | "under UN supervision, Russia leaves

01:10:21.540 | "if that is the will of the people."

01:10:24.080 | And then he says, "Crimea, formerly part of Russia,

01:10:25.820 | "as it's been since 1783,

01:10:27.260 | "water supply to Crimea assured."

01:10:29.440 | As you're saying, Ukraine remains neutral.

01:10:31.400 | Should the West force Ukraine

01:10:34.040 | to accept these type of terms, essentially elections,

01:10:37.460 | and I don't know why Crimea wouldn't be part

01:10:39.040 | of that election process.

01:10:40.240 | Do you think UN-supervised elections

01:10:43.440 | in those regions should occur,

01:10:45.480 | and we should force Zelensky to do that?

01:10:47.920 | - He who pays the piper calls the tune.

01:10:50.580 | Of course, we need to have a point of view

01:10:52.740 | on how this war should be resolved.

01:10:54.180 | - Should we force him to do that?

01:10:55.900 | - Listen, it's not about force.

01:10:57.580 | They can fight on and do whatever they want,

01:10:59.700 | as long as they want, hold on,

01:11:00.940 | without American weapons. - For our support, I'm saying.

01:11:02.580 | That's what you said. - Without American weapons.

01:11:03.980 | If they want-- - So you think

01:11:04.820 | he should do that?

01:11:05.640 | We should pull the American weapons if he doesn't.

01:11:07.620 | - If Zelensky wants our weapons and support,

01:11:11.020 | which appear to be infinite,

01:11:12.420 | we should not give him a blank check guarantee.

01:11:14.420 | The blank check is what started World War I,

01:11:17.300 | the German Kaiser gave Austria a blank check guarantee,

01:11:20.060 | and it led to World War I.

01:11:21.260 | That is how great powers get pulled

01:11:22.940 | into the wars of minor powers.

01:11:25.300 | And we absolutely have to have a point of view

01:11:27.380 | on how we do not get pulled into this.

01:11:29.660 | And I think one of our lines should be

01:11:33.020 | that we are not gonna fund the Ukrainians

01:11:35.340 | in retaking Crimea.

01:11:37.020 | - Got it, so just to clear this

01:11:39.220 | so we can move on to the next topic,

01:11:40.780 | you're in support of removing,

01:11:44.180 | not giving further weapons support to the Ukraine

01:11:47.420 | unless they negotiate this. - It's not gonna come to that.

01:11:48.740 | It's not gonna come to that.

01:11:49.740 | We need to have a point of view

01:11:50.940 | on how this war gets resolved. - But you are in support

01:11:51.780 | of that, stopping our support if they don't sit down

01:11:54.500 | and negotiate a settlement here.

01:11:56.320 | That's what you would do.

01:11:57.340 | - America needs to have a point of view

01:11:59.220 | of what is in its own interest.

01:12:00.940 | What is in our interest is for this to get resolved

01:12:03.820 | diplomatically at some point through negotiated settlement,

01:12:06.380 | not for it to escalate into a nuclear war

01:12:08.540 | that we could get pulled into.

01:12:09.940 | The only way that's gonna happen, okay,

01:12:12.580 | is if Crimea goes back to Russia.

01:12:14.220 | I'm telling you, they will be willing

01:12:15.820 | to pull out all the stops.

01:12:16.820 | And by the way, they could even use tech nukes

01:12:18.940 | before Crimea, but if-- - Can you answer

01:12:20.820 | the question though that I asked three times?

01:12:22.500 | Would you remove American support in weapons

01:12:24.540 | if they don't accept that?

01:12:25.780 | If Ukraine doesn't accept that,

01:12:26.820 | would you be comfortable taking away our support in weapons?

01:12:29.060 | - I don't think it's gonna come to that,

01:12:30.060 | but yes, we should be willing to threaten that, yes.

01:12:31.860 | - Okay, that's it, I'm just trying to get you

01:12:32.860 | to answer that one question.

01:12:33.700 | Let's-- - They are our,

01:12:34.540 | hold on a second, they are a client state of the US.

01:12:37.500 | They do not call the shots.

01:12:38.740 | We're America, we call the shots.

01:12:40.340 | We're the big dog here. - Got it, all right.

01:12:41.580 | - That's the bottom line. - All right.

01:12:42.420 | - And you really wanna get pulled into a nuclear war

01:12:44.460 | because of-- - I do not.

01:12:45.300 | I just wanted you to answer that one question.

01:12:47.060 | We should pull our weapons if they don't.

01:12:48.580 | - Let's get real. - Okay, got it.

01:12:50.060 | - This is about our future.

01:12:51.540 | You know, we are American nationalists, at least I am.

01:12:53.860 | I'm not a Ukrainian nationalist.

01:12:55.220 | I support self-rule.

01:12:56.500 | I think we accomplished something

01:12:57.700 | by preventing Kiev from getting toppled,

01:13:00.180 | but I wanna support self-rule for the people of Crimea.

01:13:03.420 | - It's time for a settlement in Saks and Matin.

01:13:05.420 | - I think the most important thing

01:13:06.740 | that we can all be thankful for,

01:13:08.300 | which I think will prevent a lot of wars

01:13:11.220 | in the next 10 or 20 years is inflation

01:13:13.900 | and non-zero interest rates.

01:13:15.340 | It's just gonna be really tough.

01:13:17.060 | Like, you know, first of all-- - I want both

01:13:17.900 | of these perspectives. - The UK cannot do anything

01:13:20.060 | right now other than make sure

01:13:21.700 | that they have foreign currency reserves

01:13:23.700 | to back up the pound,

01:13:24.820 | which they don't really have that much.

01:13:26.880 | They're gonna need money to bail out their pension system.

01:13:29.340 | Whoever thought it was a good idea

01:13:30.740 | to allow pensions to run levered risk,

01:13:33.580 | was, it's obviously insane.

01:13:35.560 | Could you imagine if it turned out

01:13:36.900 | that the teachers' pensions and the firefighters' pensions

01:13:39.380 | in America were running levered long?

01:13:41.740 | I mean-- - Oh, they are.

01:13:43.220 | They are. - They're not--

01:13:44.060 | - This has to get resolved now.

01:13:45.220 | I mean, it's just-- - You know what a pension is?

01:13:46.060 | - We're at a breaking point. - No, yeah, it's clear.

01:13:47.500 | - You know what a pension is?

01:13:48.460 | - I know, I'm not trying some fancy--

01:13:49.300 | - A pension is only, yeah, it's just a debt instrument.

01:13:51.660 | - No, no, no, no, no, I'm saying--

01:13:52.500 | - That's all it is.

01:13:53.660 | - I'm saying, don't use some fancy intellectual argument.

01:13:55.900 | I'm saying, practically speaking,

01:13:57.020 | the treasurer is not allowed to call Goldman Sachs

01:13:59.660 | and say, "I'm gonna run two turns of leverage on this money."

01:14:01.820 | That is not allowed to happen in the United States, okay?

01:14:04.460 | I get in some fancy way it could be thought of

01:14:06.500 | as levered long with all kinds of indirection,

01:14:09.020 | but that is not how the world works today,

01:14:10.660 | practically speaking.

01:14:11.780 | It is how the UK works.

01:14:13.580 | A treasurer in a UK pension system

01:14:15.620 | is allowed to call an investment bank

01:14:18.580 | and actually run levered.

01:14:20.540 | That is insane, okay?

01:14:23.260 | So my point is, when rates are non-zero,

01:14:26.060 | all of that jig is up,

01:14:28.180 | governments are forced to batten down the hatches,

01:14:31.380 | and husband cash,

01:14:34.540 | for God knows what will break in the system.

01:14:37.020 | And I think that that is, and as disruptive as that is,

01:14:41.500 | it may actually be the bulwark against war.

01:14:45.140 | - The jig is up, folks.

01:14:47.260 | I mean, I think that's what we should take away from this is

01:14:50.740 | we can't afford this, and the United States is funding it.

01:14:53.280 | We have to force a settlement here,

01:14:54.620 | and it will be a profound courage.

01:14:55.460 | - And that may be the silver lining of inflation.

01:14:58.060 | - Okay, Andy Jassy's had an all-hands meeting.

01:15:00.780 | Amazon is freezing hiring for corporate roles

01:15:02.860 | in its retail business.

01:15:03.860 | Almost 90 VPs or higher level execs

01:15:05.940 | have left Amazon since 2021.

01:15:07.740 | Earlier this week, there was an all-hands presentation,

01:15:10.380 | and the slides were leaked to Business Insider.

01:15:13.380 | Some of them, "Constraints breed resourcefulness,

01:15:15.940 | "self-sufficiency, and innovation.

01:15:17.580 | "There are no extra points for growing headcount,

01:15:19.720 | "budget size, or fixed expense.

01:15:21.180 | "The slide instructed employees to accomplish more

01:15:23.620 | "with less," sounds familiar,

01:15:25.380 | sounds like something the US needs to do,

01:15:27.220 | and foreign policy needs to do.

01:15:28.740 | "Amazon leadership team urged employees

01:15:30.740 | "to double down on frugality."

01:15:33.140 | Jassy also spoke in the meeting, just a couple of quotes,

01:15:35.780 | and then I'll get your thoughts, Chamath.

01:15:37.940 | "It's on a lot of people's minds,

01:15:39.080 | "and of course, none of us know for sure

01:15:40.760 | "what's gonna happen, but there are a lot of signs

01:15:42.960 | "that point to this being a difficult

01:15:44.680 | "and rough economy ahead of us,

01:15:45.840 | "and I don't know how long that'll last.

01:15:47.960 | "But I think it's one of the things

01:15:49.560 | "that we are thinking about, and we decided that

01:15:52.280 | "we're going to be more streamlined

01:15:53.940 | "in how we expand in 2023 good companies

01:15:56.860 | "that last a long period of time,

01:15:58.420 | "who are thinking about the long term,

01:16:00.020 | "always have this push and pull."

01:16:02.220 | Chamath, what do you read into this?

01:16:04.740 | - I'll say three quick things.

01:16:06.180 | One is that today, Thursday, October 13th,

01:16:09.820 | we had an inflation print which was worse than expected,

01:16:14.040 | and the markets are materially higher, right?

01:16:16.300 | So, you know-- - Strange, why?

01:16:18.080 | - Well, we talked about this a few weeks ago,

01:16:20.900 | but my thought then, and it's the same that I think now,

01:16:24.660 | is that we've effectively seen the near-term bottom,

01:16:27.340 | and we're now consolidating.

01:16:28.780 | And so every opportunity people have

01:16:31.140 | to justify that most of the news is behind them,

01:16:33.620 | they take, and they use that as a reason to buy.

01:16:36.420 | Okay, so that's number one,

01:16:37.760 | which is that we are sort of near the end.

01:16:40.540 | The second, however, is that if we do see another leg down,

01:16:45.440 | there is really only one cohort of company

01:16:49.300 | that hasn't been really whacked.

01:16:51.300 | And I'll summarize it very quickly by saying

01:16:53.040 | it's Microsoft, Amazon, Apple, and Google, that's it.

01:16:57.140 | Even Facebook has now been sort of put into the bucket

01:16:59.740 | of everybody else, where we've been crushed 60, 70, 80%

01:17:03.940 | in those companies.

01:17:05.260 | So what does that mean?

01:17:07.780 | Well, those four companies are now being identified

01:17:12.020 | for what they may be,

01:17:13.660 | which in capitalism is called over-earning, okay?

01:17:17.420 | They are making more money than we think is appropriate.

01:17:21.060 | This letter from Andy Jassy is his way

01:17:23.460 | of effectively telling his major shareholders

01:17:26.900 | that he is now moving the business

01:17:28.540 | to become more of a cash cow business.

01:17:30.900 | Tim Cook made this incredible decision in 2016, '17, '18

01:17:35.540 | that effectively did the same thing.

01:17:37.020 | That's when Buffett came in.

01:17:38.500 | That's when he established a huge ownership in the stock.

01:17:41.040 | That's when the stock absolutely ripped

01:17:43.300 | because it moved into a different bucket in people's minds.

01:17:46.660 | It became growth at a pretty reasonable price.

01:17:49.540 | And I think Andy is making the case

01:17:51.100 | that Amazon is gonna become one of these GARP stocks,

01:17:54.100 | growth at a reasonable price.

01:17:55.740 | He's gonna generate a ton of cash flow.

01:17:58.260 | He's gonna keep expenses nominal.

01:18:00.940 | He's gonna return a ton of cash

01:18:02.700 | to shareholders with buybacks.

01:18:04.340 | That's the reading in between the lines of that letter.

01:18:07.300 | I think it's a really profound statement

01:18:09.540 | and a very smart move because you haven't seen that letter

01:18:14.100 | or a version of that letter yet from Microsoft.

01:18:16.580 | And you started to see hints of that letter from Sundar

01:18:19.740 | where he said, you know, it's, and he's not-

01:18:22.180 | - He's saber rattling, yeah.

01:18:23.340 | - He's not there yet.

01:18:24.160 | He's in the appetizer part.

01:18:26.260 | You know, he's in the amuse-bouche where he's like,

01:18:27.980 | oh, you know, guys, you gotta work harder.

01:18:29.900 | Hey guys, let's create some fancy acronyms.

01:18:32.260 | But Sundar's got courage.

01:18:33.940 | No, no, no, but he's got courage.

01:18:35.020 | He is gonna rip the bandaid off too.

01:18:37.020 | And so I think what it means is these three

01:18:40.000 | and maybe these four companies

01:18:41.940 | are gonna draw a hard line in the sand

01:18:44.260 | and say, we are not over-earning, do not abandon this stock.

01:18:48.060 | That again will help put in a bottom in the stock market.

01:18:51.860 | - What do you think, Freeberg?

01:18:52.900 | You worked at this company and you know,

01:18:55.380 | the principles across the board,

01:18:58.420 | the saber rattling will turn into saber swinging

01:19:01.140 | in Q4, Q1, you think?

01:19:03.900 | Google, Apple?

01:19:04.740 | Cuts coming?

01:19:07.460 | - Amazon is affected in a different way

01:19:11.900 | because they operate this physical supply chain business.

01:19:14.780 | They're delivering goods to people's homes

01:19:16.760 | that people are buying.

01:19:17.660 | So they're, they really have to change their trajectory

01:19:22.980 | very quickly.

01:19:23.820 | It was incredible.

01:19:24.660 | You guys remember when COVID hit,

01:19:26.480 | you tried to place an order on Amazon.

01:19:27.900 | It was like three weeks to deliver

01:19:29.340 | because the infrastructure wasn't there to do it.

01:19:31.180 | So they actually were seeing more orders

01:19:33.980 | than their system had predicted.

01:19:35.700 | And they did massive build out.

01:19:37.140 | They hired what, a million people or something

01:19:39.700 | in their network to meet demand.

01:19:41.520 | And then over the next year,

01:19:43.500 | earnings went through the roof,

01:19:45.420 | their infrastructure and employee headcount

01:19:47.420 | went through the roof.

01:19:48.260 | And now we're obviously coming back down

01:19:49.620 | the other side of a mountain

01:19:51.220 | and they're having to shift strategy

01:19:53.500 | and shift their operating model yet again.

01:19:56.700 | There's a broader set,

01:19:58.940 | and that's because they're in the direct commerce business.

01:20:02.180 | Microsoft, Google, and other kind of software companies,

01:20:07.180 | some of which benefit from advertising,

01:20:09.520 | which is almost like a first derivative

01:20:11.060 | on the consumer market,

01:20:12.700 | or a first derivative on the spending of companies

01:20:15.340 | that sell to consumers,

01:20:16.740 | have a little bit of a different calculus.

01:20:19.140 | They're a much higher margin business,

01:20:21.420 | 30% EBITDA kind of business,

01:20:23.980 | with EBITDA margin business,

01:20:26.220 | with a very distinct kind of set of challenges

01:20:29.460 | on how advertising revenue is gonna be affected

01:20:31.960 | over the next couple of quarters

01:20:33.580 | and balancing that against their cloud platform,

01:20:36.380 | which is sold to enterprises

01:20:38.660 | and their media consumption platform,

01:20:40.780 | which is generally like YouTube at Google's case,

01:20:43.300 | which is less affected.

01:20:44.140 | So it's not as much of a direct calculus.

01:20:46.180 | I will say what's happened over the past decade,

01:20:48.060 | which we're now seeing change,

01:20:49.660 | is these companies have had extraordinary growth,

01:20:52.340 | hiring people to no end.

01:20:54.580 | There's always been kind of this extended expense

01:20:59.420 | on human capital.

01:21:01.500 | And that expense on human capital

01:21:03.380 | has driven the average cost per employee through the roof.

01:21:06.660 | And it's not just the salaries,

01:21:08.420 | it's the cost of the RSUs,

01:21:09.820 | it's the cost of the facilities and the free ice cream

01:21:12.100 | and the gyms and all the other stuff

01:21:13.880 | that's gone on to compete.

01:21:15.620 | That's now changing.

01:21:17.140 | And so it really is creating a different model

01:21:18.940 | for operating that hasn't existed for the last decade,

01:21:21.020 | where everything has been,

01:21:22.500 | how many more things can we throw in the kitchen,

01:21:24.740 | like the kitchen sink at this problem

01:21:26.500 | to get all the human capital here?

01:21:28.220 | And I think that's really,

01:21:30.220 | what's gonna kind of structurally change in the Valley.

01:21:32.620 | It's not as acute as what Amazon is dealing with.

01:21:35.060 | - It does feel like those are the last

01:21:38.420 | cities to fall to them off.

01:21:41.420 | - They are the ones that take the index to 3,200.

01:21:45.140 | If we're gonna try to do it,

01:21:46.820 | there's only one place to look,

01:21:48.020 | you've whacked everybody else.

01:21:49.700 | Everything is down 50 to 90% in some cases.

01:21:54.700 | - And then finally--

01:21:56.820 | - And by the way, sorry, just at the end of last year,

01:21:59.140 | a quarter of every S&P dollar was crowded in those names,

01:22:02.220 | a quarter.

01:22:03.340 | So you gotta go there.

01:22:05.220 | - Yeah, I mean, and also they're automatically bought,

01:22:07.540 | they're automatically bought by these index funds.

01:22:09.500 | And so who's at the wheel saying,

01:22:12.100 | we're gonna take the money out of them?

01:22:13.860 | Who in their right mind is taking money

01:22:15.980 | out of Apple, Amazon, and Microsoft, where do you put it?

01:22:19.220 | I guess is everybody's question, right, Shamal?

01:22:20.900 | If you take it out of there, where do you put it?

01:22:23.460 | - Well, no, I think it's just that

01:22:25.020 | when you have patterns of selling,

01:22:27.700 | typically as I've seen it,

01:22:29.580 | my experience is that initially it's the algorithms

01:22:32.180 | that really start to push a market in a direction.

01:22:35.980 | Then you have the more traditional fund complexes,

01:22:40.500 | that's the hedge funds and the long onlys,

01:22:42.180 | they follow suit.

01:22:44.140 | And then the last group tends to be retail.

01:22:46.700 | And it works in reverse the other way as well.

01:22:50.940 | And so, obviously there's exceptions to all of these,

01:22:53.420 | but as a general rule.

01:22:54.860 | - So if retail starts bailing on Amazon and Apple.

01:22:57.060 | - Well, they are right now.

01:22:58.580 | They are sellers now.

01:23:00.300 | - So now time to buy it.

01:23:02.340 | - But again, this is where sort of organized capital now

01:23:05.900 | is finding a bottom.

01:23:07.260 | Again, like when you start to shake,

01:23:09.100 | just think about the psychology of like being delivered

01:23:11.940 | bad news after bad news.

01:23:13.300 | You go through the cycles, right?

01:23:14.740 | There's denial, there's anger, there's depression,

01:23:17.140 | there's bargaining, but then at some point there's acceptance

01:23:20.260 | and in that acceptance phase, you're like,

01:23:22.660 | "Yeah, you're right, things are bad."

01:23:25.140 | But when you see a market rally into a print like this,

01:23:27.860 | it's really, really interesting psychological turning point.

01:23:32.340 | - As a proof point to what you're saying, Sax, Chamath,

01:23:35.500 | and Sax, I wanna get your comment on this.

01:23:37.340 | Venture capital firms like Sequoia, Excel and others

01:23:41.020 | that have now changed their status as just private companies

01:23:44.500 | but also dabbling in public are buying public equities,

01:23:48.260 | which basically means they see more opportunity

01:23:52.260 | in public underpriced tech stocks, growth stocks, et cetera,

01:23:56.660 | than they do in late stage private companies, correct?

01:24:00.860 | And you saw the Wall Street Journal story,

01:24:01.940 | I'm assuming, Sax?

01:24:03.460 | - Yeah, I saw that.

01:24:04.700 | - What's your read into that?

01:24:06.700 | Is it overblown or is it indicative of something?

01:24:08.740 | - I think it's probably overblown

01:24:10.140 | because Sequoia created that fund that is a hedge fund

01:24:12.900 | and Andreessen Horowitz became a registered

01:24:15.300 | investment advisor so they could buy public securities.

01:24:17.540 | So look, I don't think most venture funds

01:24:19.820 | are all of a sudden investing in public markets.

01:24:21.460 | We aren't even allowed to do that as far as I know,

01:24:23.900 | nor would we ever try to.

01:24:25.460 | So I think probably it's exaggerated.

01:24:28.260 | - You have to give up, Sax, your VC exemption,

01:24:30.860 | but you could do it.

01:24:31.780 | - You could do it, yeah.

01:24:32.620 | - Yeah, I mean, we wouldn't want to,

01:24:33.940 | but it's kind of the point.

01:24:35.900 | But look, I can't explain why the market

01:24:38.700 | did what it did today.

01:24:40.140 | It could have, like Jamal said,

01:24:41.340 | it could have been some sort of algorithmic

01:24:43.820 | buying or selling.

01:24:46.340 | But I just think that the overall news today

01:24:49.660 | was the economic news was just another really bad report.

01:24:53.180 | I mean, just look at these headlines

01:24:54.540 | from the New York Times today.

01:24:55.540 | Okay, I'm gonna read you the headlines

01:24:58.060 | on a single sort of scrolling page here.

01:25:00.980 | Number one, inflation came in much faster than expected.

01:25:03.540 | Bad news for the Fed.

01:25:05.180 | Takeaways from another painful inflation report.

01:25:08.020 | Three, disappointing inflation data

01:25:09.740 | keeps Democrats on defense ahead of midterm elections.

01:25:11.820 | Four, food prices climb again,

01:25:13.700 | weighing on household budgets.

01:25:14.820 | Five, rent inflation remained tepid, a troubling sign.

01:25:18.100 | Six, used car prices aren't declining

01:25:20.220 | as much as the economists of the hope.

01:25:21.340 | - Slow down, slow down. - Seven.

01:25:23.260 | - Give Freeberg a chance to take some Xanax.

01:25:25.060 | Take Xanax, Freeberg.

01:25:25.900 | - Yeah, gas prices fall slightly,

01:25:27.660 | but overall energy costs are soon expected to rise.

01:25:29.940 | And eight, retirees are getting an 8.7% social security cost

01:25:33.620 | living raise, the biggest in decades.

01:25:34.780 | I guess that one is sort of positive,

01:25:36.300 | but it's like literally negative headline

01:25:38.580 | after negative headline in the New York Times.

01:25:40.580 | - But can I reinterpret that for you?

01:25:42.620 | I think the way to think about it is

01:25:44.700 | this gives the Fed the resolve it needs.

01:25:47.140 | It's gonna go by 75.

01:25:48.540 | It's probably gonna go another 75.

01:25:50.620 | We're gonna have rates by four to 450 to 5%,

01:25:54.100 | probably within Q1, which means if you're trying

01:25:56.860 | to figure out where the bottom is, it's roughly now-ish.

01:25:59.820 | And so that's why you see smart money,

01:26:01.460 | David, shaking this thing off

01:26:03.340 | and starting to enter the market.

01:26:05.260 | And so again, and the other version interpretation is

01:26:08.580 | when rates are four or 5%,

01:26:10.540 | the cost of servicing United States debt

01:26:13.020 | is so meaningful as a percentage of their budget,

01:26:15.780 | the incremental spend that they would need to make

01:26:18.540 | to enter a new war is too much, I think.

01:26:21.660 | - I love this point.

01:26:22.500 | I love this point.

01:26:23.340 | We're weaving all these things together.

01:26:25.380 | Do we want, I mean- - Yeah, well, look.

01:26:27.740 | Right, so on the economics page of the New York Times,

01:26:30.940 | it's just disastrous headline after disastrous headline.

01:26:33.100 | Then you turn to the foreign policy page,

01:26:34.420 | you got Tom Friedman writing a column here saying,

01:26:37.500 | "We are suddenly taking on China and Russia at the same time."

01:26:39.780 | And Tom Friedman historically has been a huge hawk.

01:26:42.500 | And he is even saying- - He's saying pump the brakes.

01:26:45.580 | - Yeah, pump on the brakes.

01:26:46.620 | Never fight Russia and China at the same time.

01:26:49.220 | So he says, "We are in uncharted waters.

01:26:52.020 | I just hope these are not our new forever wars."

01:26:54.060 | It's like, whoa.

01:26:55.340 | So basically, look, our economic base,

01:26:57.540 | our economy is crumbling at home at the same time

01:27:00.640 | that we are doing unprecedented saber-rattling abroad.

01:27:03.580 | This does not compute.

01:27:05.060 | We need to take a time out here.

01:27:06.980 | - My prediction, I agree with you.

01:27:07.820 | - No mention of Iran?

01:27:08.860 | - But my prediction is that we will not enter a new war

01:27:12.900 | with rates flexing up as aggressively as they are.

01:27:15.980 | - I love it.

01:27:16.800 | I love weaving these two stories together.

01:27:17.860 | I think it makes a lot of sense.

01:27:19.740 | We didn't have time for Alex Jones,

01:27:21.540 | but we'll save that for another episode.

01:27:22.780 | Gentlemen, I think it's our best episode ever.

01:27:24.620 | It's an honor and a privilege to spend this hour or so

01:27:27.300 | with you every week.

01:27:28.140 | I love you like brothers.

01:27:29.940 | And it's been a great 100 episodes.

01:27:31.820 | I look forward to 100 more.

01:27:33.780 | Sax, if you need a mental health break.

01:27:35.740 | Dr. Friedberg's a psychiatrist.

01:27:37.300 | He's got him doped up.

01:27:38.700 | - David will be back next Friday.

01:27:39.700 | I just want to say- - Turn off replies, David.

01:27:41.260 | Don't read your replies.

01:27:42.300 | Get off of that.

01:27:43.140 | - I just want to say how much I love you guys.

01:27:44.660 | And I'm really proud of what we've created.

01:27:47.780 | And I'm really excited to get to the next 100.

01:27:50.080 | And I'll see you guys tonight.

01:27:52.620 | I'll break out the white trumpet.

01:27:53.900 | - So you want to keep going?

01:27:55.540 | That's the news today?

01:27:56.700 | - I'm in for a hunty.

01:27:58.460 | I'm in for a hunty.

01:27:59.620 | I love you, Sax.

01:28:00.460 | - I will say that J.K. Hall's moderation's been

01:28:02.740 | a lot better since he got brigaded.

01:28:05.140 | - That is his way of saying he'll be,

01:28:06.940 | he'll see you next Friday.

01:28:08.260 | - He'll see you.

01:28:09.100 | - I love you guys. - It's been 100 episodes.

01:28:11.180 | I love you, Chamath.

01:28:12.020 | I love you, Friedberg.

01:28:12.840 | Let's see if we can get Sax to do it.

01:28:15.100 | It's been 100 episodes.

01:28:16.180 | He hasn't said it yet, but I love you, Sax.

01:28:18.260 | - David, are you coming tonight?

01:28:19.420 | Sax, are you coming tonight?

01:28:20.260 | - Yeah, I'll come.

01:28:21.100 | - You're coming? - Oh, wait, wait, wait.

01:28:22.340 | Let me check.

01:28:23.180 | I'll get back to you offline.

01:28:24.580 | - Jesus Christ, God, Jesus.

01:28:25.820 | - All right, but hold on a second.

01:28:26.740 | Hold on a second.

01:28:27.580 | Sax, I love you.

01:28:28.420 | Let's see if we can get him to say it.

01:28:29.260 | - Back at you.

01:28:30.100 | - Okay, I got him. - Sax, I love you.

01:28:31.540 | - Back at you.

01:28:32.380 | - That's two.

01:28:33.200 | Going around the horn.

01:28:34.380 | - Back at you.

01:28:35.220 | - Friedberg, can you say I love you too?

01:28:36.660 | Can you say I love you?

01:28:37.500 | - David, I love you. - Sax, I see you.

01:28:38.500 | I see you. - David, I love you.

01:28:40.540 | - What did you tell Coolio?

01:28:41.860 | - Friedberg, I love you. - I appreciate you.

01:28:43.540 | - Oh, you appreciate.

01:28:44.460 | Okay, we got him. - Chamath, I appreciate you.

01:28:45.300 | - We got him back at you, and I appreciate you.

01:28:46.940 | That's 100, baby. - You guys, I appreciate you.

01:28:48.540 | - That's 100.

01:28:49.380 | - See you at Florida. - Cal, I love you.

01:28:50.220 | - Episode two, I love you too, Chamath.

01:28:51.420 | I'll see you tonight. - Love you, Cal.

01:28:52.260 | - Bye, bye.

01:28:53.100 | ♪ I'm going all in ♪

01:28:54.860 | ♪ We'll let your winners ride ♪

01:28:57.580 | ♪ Rain Man, David Saxon ♪

01:28:59.460 | ♪ I'm going all in ♪

01:29:01.940 | ♪ And it said ♪

01:29:02.780 | ♪ We open sourced it to the fans ♪

01:29:04.140 | ♪ And they've just gone crazy with it ♪

01:29:06.020 | ♪ Love you, West, I'm the queen of quinoa ♪

01:29:08.100 | ♪ I'm going all in ♪

01:29:10.940 | ♪ We'll let your winners ride ♪

01:29:14.860 | ♪ Besties are gone ♪

01:29:17.540 | ♪ My dog taking a notice in your driveway ♪

01:29:22.540 | ♪ My avatar will meet me at the place ♪

01:29:25.220 | ♪ We should all just get a room ♪

01:29:26.260 | ♪ And just have one big huge orgy ♪

01:29:27.860 | ♪ 'Cause they're all just useless ♪

01:29:29.140 | ♪ It's like this like sexual tension ♪

01:29:30.580 | ♪ That they just need to release somehow ♪

01:29:33.220 | ♪ Wet your feet ♪

01:29:36.060 | ♪ Wet your feet ♪

01:29:38.540 | ♪ We need to get merch ♪

01:29:39.380 | ♪ Besties are gone ♪

01:29:40.220 | ♪ I'm going all in ♪

01:29:43.220 | (upbeat music)

01:29:45.820 | ♪ I'm going all in ♪

01:29:50.860 | you

01:29:51.360 | you

E100: Reflecting on the first 100 shows, fan questions, nuclear threat, markets, Amazon & more

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